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What changed in FIRST COMMONWEALTH FINANCIAL CORP /PA/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of FIRST COMMONWEALTH FINANCIAL CORP /PA/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+327 added−301 removedSource: 10-K (2026-03-02) vs 10-K (2025-03-03)

Top changes in FIRST COMMONWEALTH FINANCIAL CORP /PA/'s 2025 10-K

327 paragraphs added · 301 removed · 253 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

64 edited+12 added−14 removed159 unchanged
Biggest changeOur 401k plan offers an employer match on employee contributions of up to 4% of eligible earnings which will change to up to 5% of eligible earnings starting in January 2025. We offer a variety of other benefits, including life insurance and disability plans, a generous paid-time off policy and a wide array of voluntary plan options.
Biggest changeWe offer a variety of other benefits, including employer paid life insurance and disability plans, a generous paid-time off policy and a wide array of voluntary plan options. Health and Safety We continue to prioritize the safety and well-being of our employees, customers, partners and communities through healthy workplace practices and consistent communication reminders and updates.
Credit risk for commercial real estate loans can arise from economic conditions that could impact market demand, rental rates and property vacancy rates and declines in the collateral value in relation to the outstanding loan balance in the event of a default and subsequent liquidation of collateral. Real Estate Construction Real estate construction represents financing for real estate development.
Credit risk for commercial real estate loans can arise from economic conditions that could impact market demand, rental rates, property vacancy rates and declines in the collateral value in relation to the outstanding loan balance in the event of a default and subsequent liquidation of collateral. Real Estate Construction Real estate construction represents financing for real estate development.
We partner with a wellness vendor to provide our healthcare members personal access to their own Health Advisor to coordinate care, and to have free access to nutrition counseling, fitness and financial coaching, mental and emotional health specialists, and condition management services.
We partner with a wellness vendor to provide our healthcare members with personal access to their own Health Advisor to coordinate care, and to have free access to nutrition counseling, fitness and financial coaching, mental and emotional health specialists, and condition management services.
The guidance, which covers all employees that have the 15 Table of Contents ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon the key principles that a banking organization’s incentive compensation arrangements should (i) provide incentives that do not encourage risk-taking beyond the organization’s ability to effectively identify and manage risks, (ii) be compatible with effective internal controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.
The guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon the key principles that a banking organization’s incentive compensation arrangements should (i) provide incentives that do not encourage risk-taking beyond the organization’s ability to effectively identify and manage risks, (ii) be compatible with 15 Table of Contents effective internal controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.
Abusive acts or practices are defined as those that materially interfere with a consumer’s ability to understand a term or condition of a consumer financial product or service or take unreasonable advantage of a consumer’s (i) lack of financial savvy, (ii) inability to protect himself in the selection or use of consumer financial products or services, or (iii) reasonable reliance on a covered entity to act in the consumer’s interests.
Abusive acts or practices are defined as those that materially interfere with a consumer’s ability to understand a term or condition of a consumer financial product or service or take unreasonable advantage of a consumer’s (i) lack of financial savvy, (ii) inability to protect himself or herself in the selection or use of consumer financial products or services, or (iii) reasonable reliance on a covered entity to act in the consumer’s interests.
However, the adjustments based on brokered deposits to the assessment base will not apply so long as the institution is well capitalized and has a composite CAMELS rating of 1 or 2.
However, the adjustments based on the ratio of brokered deposits to the assessment base will not apply so long as the institution is well capitalized and has a composite CAMELS rating of 1 or 2.
These assessment rates are subject to adjustments based upon the insured depository institution’s ratio of long-term unsecured debt to the assessment base, long-term unsecured debt issued by other insured depository institutions to the assessment base, and brokered deposits to the assessment base.
These assessment rates are subject to adjustments based upon the insured depository institution’s ratio of long-term unsecured debt to the assessment base, its ratio of long-term unsecured debt issued by other insured depository institutions to the assessment base, and its ratio of brokered deposits to the assessment base.
Our underwriting process for non-owner occupied properties evaluates the history of occupancy, quality of tenants, lease terms, operating expenses and cash flow. Commercial real estate loans are subject to the same credit evaluation as previously described for commercial loans. Approximately 23%, by principal amount, of our commercial real estate loans involve owner-occupied properties.
Our underwriting process for non-owner occupied properties evaluates the history of occupancy, quality of tenants, lease terms, operating expenses and cash flow. Commercial real estate loans are subject to the same credit evaluation as previously described for commercial loans. Approximately 24%, by principal amount, of our commercial real estate loans involve owner-occupied properties.
The current standards are known as the "Basel III Capital Rules." These rules require First Commonwealth and FCB to maintain the following: • A minimum ratio of Common Equity Tier 1 (“CET1”) to risk-weighted assets of at least 4.5%, plus a 2.5% “capital conservation buffer” (resulting in a minimum ratio of CET1 to risk-weighted assets of 7.0%); • A minimum ratio of Tier 1 capital to risk-weighted assets of at least 6.0%, plus the capital conservation buffer (resulting in a minimum Tier 1 capital ratio of 8.5%); • A minimum ratio of total capital (Tier 1 capital plus Tier 2 capital) to risk-weighted assets of at least 8.0%, plus the capital conservation buffer (resulting in a minimum total capital ratio of 10.5%); and 12 Table of Contents • A minimum leverage ratio of 4.0%, calculated as the ratio of Tier 1 capital to average consolidated assets as reported on consolidated financial statements (known as the “leverage ratio”).
The current standards are known as the "Basel III Capital Rules." These rules require First Commonwealth and FCB to maintain the following: • A minimum ratio of Common Equity Tier 1 (“CET1”) to risk-weighted assets of at least 4.5%, plus a 2.5% “capital conservation buffer” (resulting in a minimum ratio of CET1 to risk-weighted assets of 7.0%); • A minimum ratio of Tier 1 capital to risk-weighted assets of at least 6.0%, plus the capital conservation buffer (resulting in a minimum Tier 1 capital ratio of 8.5%); • A minimum ratio of total capital (Tier 1 capital plus Tier 2 capital) to risk-weighted assets of at least 8.0%, plus the capital conservation buffer (resulting in a minimum total capital ratio of 10.5%); and • A minimum leverage ratio of 4.0%, calculated as the ratio of Tier 1 capital to average consolidated assets as reported on consolidated financial statements (known as the “leverage ratio”).
The final rule defines overdraft credit as generally including consumer credit extended by a financial institution to pay a transaction from a checking or other transaction account (other than a prepaid account) held at the financial institution when the consumer has insufficient or unavailable funds in that account.
The final rule defined overdraft credit as generally including consumer credit extended by a financial institution to pay a transaction from a checking or other transaction account (other than a prepaid account) held at the financial institution when the consumer has insufficient or unavailable funds in that account.
The final rule requires that extensions of overdraft credit adhere to consumer protections required of similarly situated products, unless the overdraft fee is at or below the institution's costs and losses as determined by (i) calculating its own costs and losses using a standard set forth in the rule; or (ii) relying on a benchmark flat fee of five dollars.
The final rule would have required that extensions of overdraft credit adhere to consumer protections required of similarly situated products, unless the overdraft fee is at or below the institution's costs and losses as determined by (i) calculating its own costs and losses using a standard set forth in the rule; or (ii) relying on a benchmark flat fee of five dollars.
Interchange fees, or “swipe” fees, are charges that merchants pay to us and other card-issuing banks for processing electronic payment transactions. Under the final rules, the maximum permissible interchange fee is equal to no more than 21 cents plus 5 basis points of the transaction value for many types of debit 14 Table of Contents interchange transactions.
Interchange fees, or “swipe” fees, are charges that merchants pay to us and other card-issuing banks for processing electronic payment transactions. Under the final rules, the maximum permissible interchange fee is equal to no more than 21 cents plus 5 basis points of the transaction value for many types of debit interchange transactions.
The CRA does not establish specific lending requirements or programs for financial institutions nor does it limit an institution’s discretion to develop the types of products and services that it believes are best suited to its particular community, consistent with the CRA.
The CRA does not establish specific lending requirements or programs for financial institutions nor does it limit an institution’s discretion 10 Table of Contents to develop the types of products and services that it believes are best suited to its particular community, consistent with the CRA.
Until the financial holding company returns to compliance, the FRB may impose limitations or conditions on the conduct of its activities, and the company may not commence any of the broader financial activities permissible for financial holding companies or acquire a company engaged in such 9 Table of Contents financial activities without prior approval of the FRB.
Until the financial holding company returns to compliance, the FRB may impose limitations or conditions on the conduct of its activities, and the company may not commence any of the broader financial activities permissible for financial holding companies or acquire a company engaged in such financial activities without prior approval of the FRB.
The NYSE's listing standards pursuant to the SEC's rule became effective on October 2, 2023. We adopted a compensation recovery policy pursuant to the NYSE listing standards on October 24, 2023. The policy was in September 2024 and is included as Exhibit 97.1 to this Form 10-K. Cybersecurity In March 2015, federal regulators issued two related statements regarding cybersecurity.
The NYSE's listing standards pursuant to the SEC's rule became effective on October 2, 2023. We adopted a compensation recovery policy pursuant to the NYSE listing standards on October 24, 2023. The policy is included as Exhibit 97.1 to this Form 10-K. Cybersecurity In March 2015, federal regulators issued two related statements regarding cybersecurity.
Our overall rating was aligned with the financial services industry and 7 Table of Contents exceeded all companies that utilize our survey provider in the USA. The survey reflected that employees have fulfillment in working for a community bank and making a difference. They are satisfied with their jobs and First Commonwealth as a whole.
Our overall rating was aligned with the financial services industry and exceeded all companies that utilize our survey provider in the USA. The survey reflected that employees have fulfillment in working for a community bank and making a difference. They are satisfied with their jobs and First Commonwealth as a whole.
Banking institutions that fail to meet the effective minimum ratios once the capital conservation buffer is taken into account, as detailed above, will be subject to constraints on capital distributions, including dividends and share repurchases, and certain discretionary executive compensation.
Banking institutions that fail to meet the effective minimum ratios once the capital conservation buffer is taken into account, as detailed above, will be subject to constraints on capital distributions, including dividends and share repurchases, and certain 12 Table of Contents discretionary executive compensation.
First Commonwealth believes that, as of December 31, 2024, FCB was a “well-capitalized” bank as defined by the FDIA.
First Commonwealth believes that, as of December 31, 2025, FCB was a “well-capitalized” bank as defined by the FDIA.
An institution may be downgraded to, or deemed to be in, a capital category that is lower than indicated by its capital ratios if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain 13 Table of Contents matters.
An institution may be downgraded to, or deemed to be in, a capital category that is lower than indicated by its capital ratios if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain matters.
At December 31, 2024, uninsured deposits totaled 27% of the total deposit portfolio. Competition The banking and financial services industry is extremely competitive in our market area.
At December 31, 2025, uninsured deposits totaled 29% of the total deposit portfolio. Competition The banking and financial services industry is extremely competitive in our market area.
As of December 31, 2024, FCB could pay dividends to First Commonwealth of $333.0 million without reducing its capital levels below "well capitalized" levels and without the approval of the Pennsylvania Department of Banking and Securities. 10 Table of Contents Community Reinvestment .
As of December 31, 2025, FCB could pay dividends to First Commonwealth of $348.0 million without reducing its capital levels below "well capitalized" levels and without the approval of the Pennsylvania Department of Banking and Securities. Community Reinvestment .
At December 31, 2024, we held $9.7 billion of total deposits, which consisted of $2.2 billion, or 23%, in non-interest bearing checking accounts, $5.7 billion, or 6 Table of Contents 59%, in interest-bearing checking accounts, money market and savings accounts, and $1.8 billion, or 18%, in CDs and IRAs.
At December 31, 2025, we held $10.3 billion of total deposits, which consisted of $2.4 billion, or 23%, in non-interest bearing checking accounts, $6.0 billion, or 6 Table of Contents 59%, in interest-bearing checking accounts, money market and savings accounts, and $1.8 billion, or 18%, in CDs and IRAs.
In October 2024, the Federal Reserve Board, the FDIC and the Office of the Comptroller of the Currency (“OCC”) issued a joint rule to modernize regulations implementing the CRA. Under the final rules, the agencies will evaluate bank performance across the varied activities they conduct and communities in which they operate.
In October 2023, the Federal Reserve Board, the FDIC and the Office of the Comptroller of the Currency (“OCC”) issued a joint rule to modernize regulations implementing the CRA ("CRA Modernization Rule"). Under the CRA Modernization Rule, the agencies would have evaluated bank performance across the varied activities they conduct and communities in which they operate.
We had 177 of our employees use 991 Community Commitment hours, a 23% increase over 2023. To recognize employees who go above and beyond in their volunteerism and community engagement, we present a quarterly “Golden Tower” award which includes $1,000 for the recipient to give to a charitable organization of their choice.
To recognize employees who go above and beyond in their volunteerism and community engagement, we present a quarterly “Golden Tower” award which includes $1,000 for the recipient to give to a charitable organization of their choice.
We also provide trust and wealth management services through FCB and offer insurance products through FCIA. At December 31, 2024, we had total assets of $11.6 billion, total loans of $9.0 billion, total deposits of $9.7 billion and shareholders’ equity of $1.4 billion.
We also provide trust and wealth management services through FCB and offer insurance products through FCIA. At December 31, 2025, we had total assets of $12.3 billion, total loans of $9.8 billion, total deposits of $10.3 billion and shareholders’ equity of $1.6 billion.
Climate-Related and Other ESG Developments In recent years, federal, state and international lawmakers and regulators have increased their focus on financial institutions' and other companies' risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters.
Climate-Related and Other ESG Developments In recent years, federal, state and international lawmakers and regulators have increased their focus on financial institutions' and other companies' risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters. We will continue to monitor and evaluate the impact of future regulatory actions related to ESG matters.
In October 2024, the CFPB issued a final rule that will require a provider of payment accounts or products, such as a bank, to make data available to consumers upon request regarding the products or services they obtain from the provider.
In October 2024, the CFPB issued a final rule implementing Section 1033 of the Dodd-Frank Act that would have required a provider of payment accounts or products, such as a bank, to make data available to consumers upon request regarding the products or services they obtain from the provider.
We will continue to monitor and evaluate the impact of future regulatory actions related to ESG matters. 16 Table of Contents Future Legislation and Regulation Congress may enact legislation from time to time that affects the regulation of the financial services industry, and state legislatures may enact legislation from time to time affecting the regulation of financial institutions chartered by or operating in those states.
Future Legislation and Regulation Congress may enact legislation from time to time that affects the regulation of the financial services industry, and state legislatures may enact legislation from time to time affecting the regulation of financial institutions chartered by or operating in 16 Table of Contents those states.
The rule is intended to give consumers control over their financial data, including with whom it is shared, and encourage competition in the provision of consumer financial products or services. FCB will be required to comply with this rule beginning April 1, 2027.
The rule was intended to give consumers control over their financial data, including with whom it is shared, and encourage competition in the provision of consumer financial products or services. FCB would have been required to comply with this rule beginning April 1, 2027. In July 2025, at the request of the CFPB, the U.S.
Lastly, our employees support each other through Hearts2Hands, an employee-funded program that provides financial assistance to employees who experience hardships. Culture and Engagement The soul of our culture is our mission to improve the financial lives of our neighbors and their businesses.
Lastly, our employees support each other through Hearts2Hands, an employee-funded program that provides financial assistance to employees who experience hardships. Culture and Engagement Our mission is to improve the financial lives of our neighbors and their businesses. This mission is supported by five core values: accountability, customer focus, integrity, excellence and inclusion.
Talent Development Guided by executive leadership, our Strategic and Inspired Leadership ("SAIL") program serves to strengthen our strategic focus and leadership culture.
Talent Development Guided by executive leadership, our Strategic and Inspired Leadership ("SAIL") program serves to strengthen our strategic focus and leadership culture through opportunities for information sharing, collaboration, and learning.
In order for a financial holding company to commence any new activity permitted by the BHC Act or to acquire a company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must have received a rating of at least satisfactory in its most recent CRA performance evaluation.
If the company does not return to compliance within 180 days, the FRB may require divestiture of the holding company’s depository institutions. 9 Table of Contents In order for a financial holding company to commence any new activity permitted by the BHC Act or to acquire a company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must have received a rating of at least satisfactory in its most recent CRA performance evaluation.
We invested in the talent development of 33 employees through attendance at banking schools and 28 employees through attendance at banking conferences. Lastly, we invest in an established, industry-specific and developmental training course library from which all employees benefit. Our talent acquisition priority is to foster the development of internal talent and to provide career advancement opportunities to our employees.
We invested in the talent development of 34 employees through attendance at banking schools and 48 employees through attendance at banking conferences. Lastly, we invest in an established, industry-specific course library from which all employees benefit. Our talent strategy prioritizes fostering the development of internal talent and providing career advancement opportunities to our employees.
We are committed to attracting, retaining and promoting top quality talent regardless of race, color, religion, gender, sexual orientation, national origin, age, disability, marital status, military status, genetic information or any other category protected by federal, state and local laws. We strive to identify and select the best candidates for all open positions based on qualifying factors for each job.
We are committed to attracting, retaining and promoting top quality talent regardless of race, color, religion, sex (including sexual orientation and pregnancy), national origin, age, disability, marital status, military status, genetic information or any other category protected by federal, state and local laws.
Our SAIL program provides opportunities for information sharing, collaboration, and learning. Since 2009, we have supported a mentorship program that is open to all employees. The program provides 1:1 mentorship pairings, group development sessions and volunteer opportunities. In 2024, a total of 144 participants participated in the program, including 104 women and 10 people of color.
Since 2009, we have supported a mentorship program that is open to all employees. The program provides 1:1 mentorship pairings, group development sessions, along with networking and volunteer opportunities. In 2025, a total of 286 participants participated in the program, including 189 women and 27 people of color.
Talent Attraction and Retention Our employees are key to the success of delivering our mission as an organization and achieving our financial targets.
Women, including one person of color, hold three seats on our Board of Directors. Talent Attraction and Retention Our employees are key to the success of delivering our mission as an organization and achieving our financial targets.
These regulations affect how consumer information is transmitted through diversified financial companies and conveyed to outside vendors. Anti-Money Laundering and the USA Patriot Act A major focus of governmental policy on financial institutions in recent years has been aimed at combating money laundering and terrorist financing.
Anti-Money Laundering and the USA Patriot Act A major focus of governmental policy on financial institutions in recent years has been aimed at combating money laundering and terrorist financing.
Our health plan is structured with a tiered premium approach in which 28% of plan participants are in the lowest tier and pay a lower monthly premium than the other two higher paying tiers.
Our health plan is structured with a tiered premium approach in which 26% of plan participants are in the lowest tier and pay a lower monthly premium than the other two higher paying tiers. Our 401k plan offers an employer match on employee contributions of up to 5% of eligible earnings starting in January 2025.
The FDIA generally prohibits a depository institution from making any capital distributions (including payment of a dividend) or paying any management fee to its parent holding company if the depository institution would thereafter be “undercapitalized.” “Undercapitalized” institutions are subject to growth limitations and are required to submit a capital restoration plan.
A bank’s capital category is determined solely for the purpose of applying prompt corrective action regulations, and the capital category may not constitute an accurate representation of the bank’s overall financial condition or prospects for other purposes. 13 Table of Contents The FDIA generally prohibits a depository institution from making any capital distributions (including payment of a dividend) or paying any management fee to its parent holding company if the depository institution would thereafter be “undercapitalized.” “Undercapitalized” institutions are subject to growth limitations and are required to submit a capital restoration plan.
Health and Safety We continue to prioritize the safety and well-being of our employees, customers, partners and communities through healthy workplace practices and consistent communication reminders and updates. We support our employees by offering several resources. An employee assistance program connects employees with resources to help them in certain life situations, such as personal counselling, legal services, and adoption.
We support our employees by offering several resources. An employee assistance program connects employees with resources to help them in certain life situations, such as personal counselling, legal services, and adoption.
The FRB also adopted a rule to allow a debit card issuer to recover 1 cent per transaction for fraud prevention purposes if the issuer complies with certain fraud-related requirements required by the FRB. The FRB also has rules governing routing and exclusivity that require issuers to offer two unaffiliated networks for routing transactions on each debit or prepaid product.
The FRB also adopted a rule to allow a debit card issuer to recover 1 cent per transaction for fraud prevention purposes if the issuer complies with certain fraud-related requirements required by the FRB.
Human Capital Resources Workforce Composition and Demographics At December 31, 2024, First Commonwealth and its subsidiaries employed 1,485 full-time employees and 60 part-time employees with 707 exempt and 838 non-exempt employees. The average age of the workforce is 43.9 years and the average tenure is 7.9 years. Our workforce is 67% female. Approximately 29% of our workforce is telecommuting.
Human Capital Resources Workforce Composition and Demographics At December 31, 2025, First Commonwealth and its subsidiaries employed 1,522 full-time employees and 55 part-time employees with 741 exempt and 836 non-exempt employees. The average age of the workforce is 44.3 years and the average tenure is 8.0 years. Our workforce is 65% female.
In 2019, we expanded our Pennsylvania markets into State College, Lock Haven, Williamsport and Lewisburg through the acquisition of 14 branches from Santander Bank, N.A.
In 2019, we expanded our Pennsylvania markets into State College, Lock Haven, Williamsport and Lewisburg through the acquisition of 14 branches from Santander Bank, N.A. In January 2023, we acquired Centric Financial Corporation ("Centric") and its banking subsidiary Centric Bank, which operated branches located in the Harrisburg and Lancaster markets. In April 2025, we acquired CenterGroup Financial Inc.
We are subject to a number of federal and state consumer protection laws that extensively govern our relationship with our customers.
Pending the rescission of the CRA Modernization Rule, the Federal banking agencies are evaluating CRA performance under the 1995 rules. Consumer Financial Protection . We are subject to a number of federal and state consumer protection laws that extensively govern our relationship with our customers.
We received more than 360 idea submissions from our employees through these channels in 2024. While we teach and practice the cultural belief of working to get better every day, we recognize that there is great value when our achievements are recognized.
In 2025, we received 221 Better submissions and 22 Better Together submissions, all of which were addressed or acted upon to make us better. While we teach and practice the cultural belief of working to get better every day, we recognize that there is great value when our achievements are recognized.
This includes evaluating lending outside traditional assessment areas generated by the growth of non–branch delivery systems, such as online and mobile banking, branchless banking, and hybrid models. The final rule adopts a new metrics–based approach to evaluating bank retail lending and community development financing, using benchmarks based on peer and demographic data.
This included evaluating lending outside traditional assessment areas generated by the growth of non-branch delivery systems, such as online and mobile banking, branchless banking, and hybrid models.
Deposits of FCB are insured up to applicable limits by the FDIC and are subject to deposit insurance assessments to maintain the Deposit Insurance Fund (“DIF”). Deposit insurance assessments are based upon average total assets minus average total equity. The insurance assessments are based upon a matrix that takes into account a bank’s capital level and supervisory rating.
In May 2025, Congress rescinded the rule pursuant to the Congressional Review Act. Deposit Insurance . Deposits at FCB are insured up to applicable limits by the FDIC and are subject to deposit insurance assessments to maintain the Deposit Insurance Fund (“DIF”). Deposit insurance assessments are based upon average total assets minus average total equity.
FCB’s uninsured deposits at December 31, 2022 were $2.1 billion; therefore we are not subject to the special assessment. Capital Requirements First Commonwealth and FCB are each required to comply with applicable capital adequacy standards established by the FRB.
Capital Requirements First Commonwealth and FCB are each required to comply with applicable capital adequacy standards established by the FRB.
At December 31, 2024, the Bank operated 124 community banking offices in 30 counties throughout western and central Pennsylvania and throughout Ohio, as well as commercial lending operations in Canton, Columbus, Canfield, Hudson and Independence, Ohio. The Bank also operates a network of 132 automated teller machines, or ATMs, at various branch offices and offsite locations.
At December 31, 2025, the Bank operated 126 community banking offices in 30 counties throughout western and central Pennsylvania and throughout Ohio, as well as commercial lending operations in Business Centers in Canfield, Canton, Hudson, Independence and Lewis Center, Ohio and Pittsburgh and Berwyn Pennsylvania.
All of our ATMs are part of the NYCE and MasterCard/Cirrus networks, both of which operate nationwide.
The Bank also operates a network of 132 automated teller machines, or ATMs, at various branch offices and offsite locations. All of our ATMs are part of the NYCE and MasterCard/Cirrus networks, both of which operate nationwide.
Our employees also participated in 435 financial education hours with 56% of those hours reaching our neighbors in low-to-moderate income communities, which is a 6% increase over 2023. The year 2024 was the second year for our Community Commitment Hours program, which allows for eight hours of paid time off that employees can use toward eligible volunteer opportunities.
The year 2024 was the second year for our Community Commitment Hours program, which allows for eight hours of paid time off that employees can use toward eligible volunteer opportunities. We had 206 of our employees use 1,146.75 Community Commitment hours, an 18% increase over 2024.
("CGFI") and its banking subsidiary, CenterBank, which operates in the Cincinnati market. We have also focused on organic growth, improving the reach of our franchise and the breadth of our product offering. As part of this strategy, we have opened fourteen de novo branches since 2005, all of which were in the greater Pittsburgh area.
("Center") and its banking subsidiary, CenterBank, which operated three full-service branches, a loan production office and a mortgage office in the Cincinnati market. We have also focused on organic growth, improving the reach of our franchise and the breadth of our product offering.
We believe that the type of employees who can help us be successful in that mission have five core values: accountability, customer focus, integrity, excellence and inclusion. We have additional leadership points that help define how the leaders of our company will lead us forward.
We have additional leadership points that help define how the leaders of our company will lead us forward.
Approximately 225 senior and sales leaders participate in three to four forums and two regional “musters” (or meetings) each year that focus on topics such as our strategic and operating plans, recruiting and retaining talent, leadership development, employee engagement and development opportunities. We also hold an annual strategic retreat, where leaders come together for leadership sessions, presentations, and networking.
Approximately 260 senior and sales leaders participate in forums and regional meetings throughout the year focused on topics like our strategic plan, recruiting and retaining talent, leadership development and employee engagement. In 2025, we held a strategic retreat, where all SAIL leaders came together for leadership sessions, presentations, and networking.
More than 50% of that giving is Community Reinvestment Act ("CRA") eligible, which means that it is directed to low to moderate income communities where we anticipate it is needed the most. Our employees volunteered for more than 16,755 service hours in 2024, which is a 23% increase from the prior year.
More than 43% of that giving is Community Reinvestment Act ("CRA") eligible, which means that it is directed to low to moderate income communities where we anticipate it is needed the most. 8 Table of Contents We provide corporate support for the United Way, including an employee campaign with a dollar-for-dollar company match.
Financial Privacy The federal banking regulators adopted rules that limit the ability of banks and other financial institutions to disclose non-public information about consumers to nonaffiliated third parties. These limitations require disclosure of privacy policies to consumers and, in some circumstances, allow consumers to prevent disclosure of certain personal information to a nonaffiliated third party.
These limitations require disclosure of privacy policies to consumers and, in some circumstances, allow consumers to prevent disclosure of certain personal information to a nonaffiliated third party. These regulations affect how consumer information is transmitted through diversified financial companies and conveyed to outside vendors.
In 2024, we achieved all time high scores in both Customer Satisfaction Score (92) and Net Promoter Score (71), exceeding our own targets and industry standards.
In 2025, we sustained industry high scores in both Customer Satisfaction Score (91.3) and Net Promoter Score (71.3), exceeding our own targets and industry standards. We listen and learn from our employees through our annual employee engagement survey. In 2025, 82.5% of our employees completed the annual engagement survey.
We provide corporate support for the United Way, including an employee campaign that exceeded our 2024 goal with employee contributions of $93,385. With the company match, a total of $190,000 was donated to United Way chapters throughout our footprint.
In 2025, we set a stretch goal of raising $100,000 in employee donations and we exceeded that goal. When combined with the bank’s match, a total of $201,894 was donated to local United Way agencies throughout our footprint.
As of December 31, 2023, our total assets exceeded $10.0 billion therefore as of July 1, 2024 we no longer qualify for this exemption. We earned approximately $21.9 million in card-related interchange income during the 2024 fiscal year.
As of December 31, 2023, our total assets exceeded $10.0 billion; therefore, as of July 1, 2024, we no longer qualify for this exemption. Financial Privacy The federal banking regulators adopted rules that limit the ability of banks and other financial institutions to disclose non-public information about consumers to nonaffiliated third parties.
Supporting Inclusion First Commonwealth values the perspectives of every one of our employees, and embraces people with different backgrounds, life experiences, points of view, talents and capabilities.
Supporting Inclusion First Commonwealth fosters an inclusive culture by valuing the diverse backgrounds, life experiences, perspectives, points of view, talents and capabilities of our employees. Senior leadership, in collaboration with our Regional Community Impact Officers and Community Engagement Manager, play key roles in ensuring the culture thrives.
The final rule also clarifies eligible CRA activities, such as affordable housing, that are focused on low- and moderate-income, underserved, native, and rural communities. The rule requires large banks (including FCB) to comply with new and expanded data gathering and reporting requirements.
The CRA Modernization Rule adopted a new metrics-based approach to evaluating bank retail lending and community development financing, using benchmarks based on peer and demographic data, and would have clarified eligible CRA activities, such as affordable housing, that are focused on low- and moderate-income, underserved, native, and rural communities. In March 2024, the U.S.
We are proud of the many recognitions that we were selected for in 2024, including top workplace in the Pittsburgh region for the sixth consecutive year, top workplace nationally for the first time, receiving a Greenwich Excellence in Small Business Award and ranking as a top SBA lender in all of our marketplaces. 8 Table of Contents In 2024, First Commonwealth supported our communities with more than $2.0 million in community giving.
We are proud of the many recognitions that we were selected for in 2025, including top workplace in the Pittsburgh region for the seventh consecutive year, a top SBA lender in all of our regions, and S&P Global Top 50 Public Banks > $10B and Forbes' lists of Best in State banks and America's Best Banks.
In 2024, we promoted 135 employees, of whom 71% were female and 5% were self-identified people of color. We listen to our employees through market visits, executive forums and our annual employee engagement survey. In 2024, 84% of our employees completed the annual survey.
In 2025, we promoted 202 employees, of whom 66% were female and 7% were self-identified people of color.
People of color and women comprised 4.3% and 50.3%, respectively, of those in leadership positions (defined by corporate title Assistant Vice President and higher). Women, including one person of color, hold four seats on our Board of Directors.
They strengthen connections between the Company and communities it serves, reinforcing commitment to both employees' well-being and meaningful community engagement. As of December 31, 2025, people of color comprised 9.4% of our workforce. People of color and women comprised 4.4% and 48.8%, respectively, of those in leadership positions (defined by corporate title Assistant Vice President and higher).
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In January 2023, we acquired Centric Financial Corporation ("Centric") and its banking subsidiary Centric Bank, which operated branches located in Harrisburg, Hershey, Mechanicsburg, Camp Hill, Doylestown, Devon, and Lancaster, Pennsylvania, and loan production offices in Lancaster and Devon, Pennsylvania. In December 2024, we entered into an agreement to acquire CenterGroup Financial Inc.
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We strive to identify and select the best candidates for all open positions based on qualifying factors for each job.
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A senior officer has overall responsibility for creating a culture that values all employees, and works closely with our Regional Community Reinvestment Act Officers and Community Engagement Manager to deepen the connections with our company and communities across our footprint. As of December 31, 2024, people of color comprised 8.9% of our workforce.
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Our employment turnover for 2025 was 25.9%, which was an increase of 2.5% from 2024 and is within the range of what we have historically experienced. 7 Table of Contents Compensation and Benefits At First Commonwealth, we seek to attract, develop, retain and reward the most talented financial professionals in our markets.
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Our employment turnover for 2024 was calculated at 23.4%, which was a reduction of 5.2% from 2023 and is generally aligned with industry benchmarks.
Added
We also have two feedback channels, called Better and Better Together, that are always available for employees to share feedback through. These channels encourage employees to submit any suggestions that they have for things we could be doing better or ways we could be working better together between departments.
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Compensation and Benefits At First Commonwealth, we believe that to achieve our vision of building financial confidence for our customers, developing the most customer-focused team in our markets, supporting our communities, and delivering long-term value to our shareholders by becoming the top performing bank within our region, we must attract, develop, retain and reward the most talented financial professionals in our markets.
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In 2025, First Commonwealth supported our communities with more than $2.1 million in community giving.
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In 2024, we introduced two new voice-of-employee feedback channels called “Better” and “Better Together” which give employees a way to voice their ideas for helping us make improvements with the way we do things and the way we work together to get even better for each other and our customers.
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Our employees volunteered for more than 18 thousand service hours in 2025, which includes a record-high 1,269 financial education hours, a 191% increase over 2024, with 92% of those hours being CRA eligible.
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If the company does not return to compliance within 180 days, the FRB may require divestiture of the holding company’s depository institutions.
Added
We are also proud to host financial education programs for our employees through our Confidence Cash program, now in its 8th year, where employees receive a chance to win randomly selected cash prizes when they complete financial education session. In 2025, we had 567 employees participate, which is an increase of 5% over 2024.
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Most of the requirements of the final rule take effect January 1, 2026, while the data requirements will take effect January 1, 2027. We are continuing to evaluate the potential impact of the new rule to our business, financial condition, and results of operations, which cannot be predicted at this time. Consumer Financial Protection .
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District Court for the Northern District of Texas issued an order enjoining the Federal banking agencies from enforcing the CRA Modernization Rule. In July 2025, the Federal banking agencies issued a joint rule proposing to rescind the CRA Modernization Rule and replace it with the prior CRA regulations that were originally adopted by the agencies in 1995.
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Any such data provider will also have to make such data available to third parties, with the consumer’s express authorization and through an interface that satisfies formatting, performance and security standards, for the purpose of such third parties providing the consumer with financial products or services requested by the consumer.
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District Court for the Eastern District of Kentucky issued an order staying compliance with the rule. In September 2025, the 11 Table of Contents CFPB published an advanced notice of proposed rulemaking seeking public comments in anticipation of adopting new rules to implement Section 1033.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeNew Lines of Business, Products or Services and Technological Advancements May Subject Us to Additional Risks From time to time, we implement new lines of business or offer new products and services within existing lines of business. There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed.
Biggest changeThere are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. We invest significant time and resources in developing and marketing new lines of business and/or new products and services we invest significant time and resources.
Any failure or circumvention of our controls and procedures, failure to comply with regulations related to controls and procedures; or failure to comply with our corporate governance policies and procedures could have a material adverse effect on our reputation, business, financial condition and results of operations.
Any failure or circumvention of our controls and procedures or failure to comply with regulations related to controls and procedures or failure to comply with our corporate governance policies and procedures could have a material adverse effect on our reputation, business, financial condition and results of operations.
Acquisitions typically involve the payment of a premium over book and market values, and, therefore, some dilution of our tangible book value and net income per common share may occur in connection with any future transaction.
Acquisitions typically involve the payment of a premium over book and market values; therefore, some dilution of our tangible book value and net income per common share may occur in connection with any future transaction.
Our Reputation and our Business Are Subject to Negative Publicity Risk Reputation risk, or the risk to our earnings and capital from negative public opinion, is inherent in our business. Negative public opinion could adversely affect our ability to keep and attract customers and expose us to adverse legal and regulatory consequences.
Our Reputation and Our Business Are Subject to Negative Publicity Risk Reputational risk, or the risk to our earnings and capital from negative public opinion, is inherent in our business. Negative public opinion could adversely affect our ability to keep and attract customers and expose us to adverse legal and regulatory consequences.
Negative public opinion could result from our actual or alleged conduct in any number of activities, including lending practices, corporate governance, regulatory compliance, mergers and acquisitions, and disclosure, sharing or inadequate protection of customer information, and from actions taken by government regulators and community organizations in response to that conduct.
Negative public opinion could result from our actual or alleged conduct in any number of activities, including lending practices, corporate governance, regulatory compliance, mergers and acquisitions, public disclosures, sharing or inadequate protection of customer information, and from actions taken by government regulators and community organizations in response to that conduct.
Our technologies, systems, networks and our clients’ devices have been subject to, and are likely to continue to be the target of, cyber-attacks, computer viruses, malicious code, phishing attacks or information security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of our or our clients’ confidential, proprietary and other information, the theft of client assets through fraudulent transactions or the disruption of our or our clients’ or other third parties’ business operations.
Our technologies, systems, networks and our clients’ devices have been subject to, and are likely to continue to be the target of, 20 Table of Contents cyber-attacks, computer viruses, malicious code, phishing attacks or information security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of our or our clients’ confidential, proprietary and other information, the theft of client assets through fraudulent transactions or the disruption of our or our clients’ or other third parties’ business operations.
Furthermore, notwithstanding the proliferation of technology and technology-based risk and control systems, our businesses ultimately rely on people as our greatest resource, who from time to time, make mistakes or engage in violations of applicable policies, laws, rules or procedures that are not always caught 19 Table of Contents immediately by our technological processes or by our controls and other procedures, all of which are intended to prevent and detect such errors or violations.
Furthermore, notwithstanding the proliferation of technology and technology-based risk and control systems, our businesses ultimately rely on people as our greatest resource, who from time to time make mistakes or engage in violations of applicable policies, laws, rules or procedures that are not always caught immediately by our technological processes or by our controls and other procedures, all of which are intended to prevent and detect such errors or violations.
Provisions of Our Articles of Incorporation, Bylaws and Pennsylvania Law, as Well as State and Federal Banking Regulations, Could Delay or Prevent a Takeover of Us by a Third Party Provisions in our articles of incorporation and bylaws, the corporate law of the Commonwealth of Pennsylvania, and state and federal regulations could delay, defer or prevent a third party from acquiring us, despite the possible benefit to our shareholders, or otherwise adversely affect the price of our common stock.
Provisions of Our Articles of Incorporation, Bylaws and Pennsylvania Law, as Well as State and Federal Banking Regulations, Could Delay or Prevent a Takeover of Us by a Third Party 23 Table of Contents Provisions in our articles of incorporation and bylaws, the corporate law of the Commonwealth of Pennsylvania, and state and federal regulations could delay, defer or prevent a third party from acquiring us, despite the possible benefit to our shareholders, or otherwise adversely affect the price of our common stock.
We have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry, including commercial banks, brokers and dealers, investment banks, and other institutional clients. Many of these transactions expose us to credit risk in the event of a default by a counterparty or client.
We have exposure to many different industries and counterparties, and routinely execute transactions with counterparties in the financial services industry, including commercial banks, brokers and dealers, investment banks, and other institutional clients. Many of 21 Table of Contents these transactions expose us to credit risk in the event of a default by a counterparty or client.
Management’s Discussion and Analysis of Financial Condition and Results of Operations under the 17 Table of Contents section captioned “Net Interest Income” and Item 7A. Quantitative and Qualitative Disclosures About Market Risk elsewhere in this report for further discussion related to interest rate sensitivity and our management of interest rate risk.
Management’s Discussion and Analysis of Financial Condition and Results of Operations under the section captioned “Net Interest Income” and Item 7A. Quantitative and Qualitative Disclosures About Market Risk elsewhere in this report for further discussion related to interest rate sensitivity and our management of interest rate risk.
Our ability to raise additional capital, if needed, will depend on, among other things, conditions in the capital markets at that time, which are outside of our control, and our financial condition.
Our ability to raise additional capital, if needed, will depend on, among other things, conditions in the capital markets at that time, which are 24 Table of Contents outside of our control, and our financial condition.
Any such failure in our analytical or forecasting models could have a material adverse effect on our business, financial condition and results of operations. The Value of Our Goodwill and Other Intangible Assets May Decline in the Future As of December 31, 2024, we had $383.4 million of goodwill and other intangible assets.
Any such failure in our analytical or forecasting models could have a material adverse effect on our business, financial condition and results of operations. The Value of Our Goodwill and Other Intangible Assets May Decline in the Future As of December 31, 2025, we had $400.2 million of goodwill and other intangible assets.
We Are Subject to Risk Arising from Conditions in the Commercial Real Estate Market As of December 31, 2024, commercial real estate mortgage loans comprised approximately 35% of our loan portfolio.
We Are Subject to Risk Arising from Conditions in the Commercial Real Estate Market As of December 31, 2025, commercial real estate mortgage loans comprised approximately 33% of our loan portfolio.
See New Accounting Pronouncements at the end of Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations elsewhere in this report for further information regarding pending accounting standards updates. We May Not Be Able to Attract and Retain Skilled People Our success depends, in large part, on our ability to attract and retain key people.
Management's Discussion and Analysis of Financial Condition and Results of Operations elsewhere in this report for further information regarding pending accounting standards updates. We May Not Be Able to Attract and Retain Skilled People Our success depends, in large part, on our ability to attract and retain key people.
The level of the allowance for credit losses reflects management’s continuing evaluation of industry concentrations, specific credit risks, loan loss experience, current loan portfolio quality, present economic conditions and unidentified losses in the current loan portfolio.
The allowance, in the judgment of management, is appropriate to reserve for estimated loan losses and risks inherent in the loan portfolio. The level of the allowance for credit losses reflects management’s continuing evaluation of industry concentrations, specific credit risks, loan loss experience, current loan portfolio quality, present economic conditions and unidentified losses in the current loan portfolio.
We invest significant time and resources in developing and marketing new lines of business and/or new products and services we invest significant time and resources. Initial timetables for the introduction and development of new lines of business and/or new products or services may not be achieved and price and profitability targets may not prove feasible.
Initial timetables for the introduction and development of new lines of business and/or new products or services may not be achieved and price and profitability targets may not prove feasible.
Such conditions could have a material adverse effect on the credit quality of our loans and our business, financial condition and results of operations. 23 Table of Contents Federal budget deficit concerns and the potential for political conflict over legislation to fund U.S. government operations and raise the U.S. government's debt limit may increase the possibility of a default by the U.S. government on its debt obligations, related credit-rating downgrades, or an economic recession in the United States.
Federal budget deficit concerns and the potential for political conflict over legislation to fund U.S. government operations and raise the U.S. government's debt limit may increase the possibility of a default by the U.S. government on its debt obligations, related credit-rating downgrades, or an economic recession in the United States.
Our stock price could also decrease regardless of operating results as a result of: (i) general market fluctuations, including real or anticipated changes in the strength of the economy; (ii) industry factors and general economic and political conditions and events, such as economic slowdowns or recessions; and (iii) interest rate changes, oil price volatility or credit loss trends. 24 Table of Contents Changes in Accounting Standards Could Materially Impact Our Financial Statements From time to time, accounting standards setters change the financial accounting and reporting standards that govern the preparation of our financial statements.
Our stock price could also decrease regardless of operating results as a result of: (i) general market fluctuations, including real or anticipated changes in the strength of the economy; (ii) industry factors and general economic and political conditions and events, such as economic slowdowns or recessions; and (iii) interest rate changes, oil price volatility or credit loss trends.
However, such unrealized losses do not affect our regulatory capital ratios. We actively monitor our available for sale securities portfolio and we do not currently anticipate the need to realize material losses from the sale of securities for liquidity purposes.
We actively monitor our available for sale securities portfolio and we do not 18 Table of Contents currently anticipate the need to realize material losses from the sale of securities for liquidity purposes.
The inability to receive dividends from FCB could have a material adverse effect on First Commonwealth’s business, financial condition and results of operations. 20 Table of Contents Acts of Cyber-Crime May Compromise Client and Company Information, Disrupt Access to Our Systems or Result in Loss of Client or Company Assets Our business is dependent upon the availability of technology, the Internet and telecommunication systems to enable financial transactions by clients, record and monitor transactions and transmit and receive data to and from clients and third parties.
Acts of Cyber-Crime May Compromise Client and Company Information, Disrupt Access to Our Systems or Result in Loss of Clients or Company Assets Our business is dependent upon the availability of technology, the Internet and telecommunication systems to enable financial transactions by clients, record and monitor transactions and transmit and receive data to and from clients and third parties.
Human errors, malfeasance and other misconduct, including the intentional misuse of client information in connection with insider trading or for other purposes, even if promptly discovered and remediated, can result in reputational damage or legal risk and have a material adverse effect on our business, financial condition and results of operations.
Human errors, malfeasance and other misconduct, including the intentional misuse of client information in connection with insider trading or for other purposes, even if promptly discovered and remediated, can result in reputational damage or legal risk and have a material adverse effect on our business, financial condition and results of operations. 19 Table of Contents New Lines of Business, Products or Services and Technological Advancements May Subject Us to Additional Risks From time to time, we implement new lines of business or offer new products and services within existing lines of business.
In addition, our credit risk may be exacerbated when the collateral held by us cannot be realized or is liquidated at prices that are insufficient to recover the full amount of the credit or derivative exposure due to us.
In addition, our credit risk may be exacerbated when the collateral held by us cannot be realized or is liquidated at prices that are insufficient to recover the full amount of the credit or derivative exposure due to us. Any such losses could have a material adverse effect on our business, financial condition and results of operations.
Unrealized Losses in Our Securities Portfolio Could Affect Liquidity As market interest rates have increased, we have experienced unrealized losses on our available for sale securities portfolio. Unrealized losses related to available for sale securities are reflected in accumulated other comprehensive income in our consolidated balance sheets and reduce the level of our book capital and tangible common equity.
Unrealized losses related to available for sale securities are reflected in accumulated other comprehensive income in our consolidated balance sheets and reduce the level of our book capital and tangible common equity. However, such unrealized losses do not affect our regulatory capital ratios.
Risks Related to Acquisition Activity Potential Acquisitions May Disrupt Our Business and Dilute Stockholder Value We generally seek merger or acquisition partners that are culturally similar and have experienced management and possess either significant market presence or have potential for improved profitability through financial management, economies of scale or expanded services.
The duration and economic impact of any government shutdown are inherently uncertain, and any such event could, individually or in the aggregate, have a material adverse effect on our business, financial condition and results of operations. 22 Table of Contents Risks Related to Acquisition Activity Potential Acquisitions May Disrupt Our Business and Dilute Stockholder Value We generally seek merger or acquisition partners that are culturally similar and have experienced management and possess either significant market presence or have potential for improved profitability through financial management, economies of scale or expanded services.
The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of operations. Our Operations Rely On Certain External Vendors We rely on certain vendors to provide products and services necessary to maintain the day-to-day operations of First Commonwealth and FCB.
Our Operations Rely On Certain External Vendors We rely on certain vendors to provide products and services necessary to maintain the day-to-day operations of First Commonwealth and FCB.
This competition comes principally from other banks, savings institutions, mortgage banking companies and credit unions, as well as institutions offering uninsured investment alternatives, including money market funds.
Competition from Other Financial Institutions in Originating Loans, Attracting Deposits and Providing Various Financial Services May Adversely Affect Our Profitability We face substantial competition in originating loans and attracting deposits. This competition comes principally from other banks, savings institutions, mortgage banking companies and credit unions, as well as institutions offering uninsured investment alternatives, including money market funds.
In the event FCB is unable to pay dividends to First Commonwealth, First Commonwealth may not be able to service debt, pay obligations or pay dividends on its common stock.
In the event FCB is unable to pay dividends to First Commonwealth, First Commonwealth may not be able to service debt, pay obligations or pay dividends on its common stock. The inability to receive dividends from FCB could have a material adverse effect on First Commonwealth’s business, financial condition and results of operations.
Difficulties associated with potential acquisitions that may result from these factors could have a material adverse effect on our business, financial condition and results of operations. 22 Table of Contents Risks Associated with Our Common Stock The Trading Volume in Our Common Stock Is Less Than That of Other Larger Financial Services Companies Although First Commonwealth’s common stock is listed for trading on the NYSE, the trading volume in its common stock is less than that of other, larger financial services companies.
Risks Associated with Our Common Stock The Trading Volume in Our Common Stock Is Less Than That of Other Larger Financial Services Companies Although First Commonwealth’s common stock is listed for trading on the NYSE, the trading volume in its common stock is less than that of other, larger financial services companies.
These changes can be difficult to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply a new or revised standard retroactively, resulting in changes to previously reported financial results or a cumulative charge to retained earnings.
In some cases, we could be required to apply a new or revised standard retroactively, resulting in changes to previously reported financial results or a cumulative charge to retained earnings. See New Accounting Pronouncements at the end of Item 7.
Economic and inflationary pressure on consumers and uncertainty regarding economic improvement could result in changes in consumer and business spending, borrowing and saving habits.
Economic and inflationary pressure on consumers and uncertainty regarding economic improvement could result in changes in consumer and business spending, borrowing and saving habits. Such conditions could have a material adverse effect on the credit quality of our loans and our business, financial condition and results of operations.
We may not be able to replace maturing deposits and advances as necessary in the future, especially if a large number of our depositors sought to withdraw 18 Table of Contents their accounts, regardless of the reason. A failure to maintain adequate liquidity could have a material adverse effect on our business, financial condition and results of operations.
As of December 31, 2025, approximately 29% of our deposits were either uninsured or otherwise unsecured, and we rely on these deposits for liquidity. We may not be able to replace maturing deposits and advances as necessary in the future, especially if a large number of our depositors sought to withdraw their accounts, regardless of the reason.
Credit and Lending Risks We Are Subject to Lending Risk There are inherent risks associated with our lending activities. These risks include, among other things, the impact of changes in interest rates and changes in the economic conditions in the markets where we operate as well as those across the United States.
These risks include, among other things, the impact of changes in interest rates and changes in the economic conditions in the markets where we operate, as well as those across the United States. 17 Table of Contents Increases in interest rates and/or weakening economic conditions could adversely impact the ability of borrowers to repay outstanding loans or the value of the collateral securing these loans.
Increases in interest rates and/or weakening economic conditions could adversely impact the ability of borrowers to repay outstanding loans or the value of the collateral securing these loans. Our Allowance for Credit Losses may be Insufficient All borrowers carry the potential to default and our remedies to recover may not fully satisfy money previously loaned.
Our Allowance for Credit Losses may be Insufficient All borrowers carry the potential to default and our remedies to recover may not fully satisfy money previously loaned. We maintain an allowance for credit losses, which represents management’s best estimate of credit losses within the existing portfolio of loans.
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We maintain an allowance for credit losses, which represents management’s best estimate of credit losses within the existing portfolio of loans. The allowance, in the judgment of management, is appropriate to reserve for estimated loan losses and risks inherent in the loan portfolio.
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Credit and Lending Risks We Are Subject to Lending Risk There are inherent risks associated with our lending activities.
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As of December 31, 2024, approximately 27% of our deposits were either uninsured or otherwise unsecured and we rely on these deposits for liquidity.
Added
A failure to maintain adequate liquidity could have a material adverse effect on our business, financial condition and results of operations. Unrealized Losses in Our Securities Portfolio Could Affect Liquidity As a result of changes in market interest rates, we have experienced unrealized losses on our available for sale securities portfolio.
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Any such losses could have a material adverse effect on our business, financial condition and results of operations. 21 Table of Contents Competition from Other Financial Institutions in Originating Loans, Attracting Deposits and Providing Various Financial Services May Adversely Affect Our Profitability We face substantial competition in originating loans and attracting deposits.
Added
The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of operations. Increasing Fraud Risk Could Adversely Affect Our Business, Financial Condition, and Reputation We are exposed to an increasing risk of fraud, including cyber fraud, identity theft, account takeover, and other fraudulent activities targeting financial institutions and their customers.
Added
The sophistication and frequency of these schemes continue to grow, driven by advances in technology and the proliferation of digital banking channels. Fraudulent activity can result in financial losses for us or our customers, increased operational costs, and potential legal exposure.
Added
Although we employ robust security measures, including authentication protocols, transaction monitoring, and fraud detection systems, these controls may not be sufficient to prevent all fraudulent activity. Criminals continuously adapt their methods to circumvent existing safeguards, and emerging technologies such as artificial intelligence may further enhance their ability to perpetrate fraud.
Added
Significant fraud-related losses could negatively impact our earnings, capital, and liquidity. In addition, fraud incidents may harm our reputation, erode customer trust, and lead to regulatory scrutiny or enforcement actions. Failure to effectively manage and mitigate fraud risk could have a material adverse effect on our business, financial condition, and results of operations.
Added
The Proliferation of Stablecoins May Adversely Impact Our Business The growing adoption of stablecoins, including yield‑bearing stablecoins, and the evolving regulatory framework under the Guiding and Establishing National Innovation for U.S. Stablecoins Act (the “GENIUS Act”), could adversely affect our deposits, liquidity, and competitive position.
Added
Certain stablecoin products may function as substitutes for traditional bank deposits while operating under different regulatory requirements. If regulatory safeguards under the GENIUS Act prove insufficient or are unevenly applied between banks and non‑bank issuers, stablecoins could facilitate deposit outflows, reduce funding stability, and create risks associated with parallel banking systems.
Added
Regulatory changes or additional compliance obligations arising from the GENIUS Act could also increase our operational costs or limit our ability to compete effectively in digital payments and settlement activities.
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We Are Subject To the Potential Adverse Effects of a U.S. Federal Government Shutdown A prolonged or repeated shutdown of the U.S. federal government could adversely affect our business, financial condition, liquidity, and results of operations.
Added
Funding gaps or lapses in federal appropriations may disrupt the operations of government agencies that provide critical economic data, administer regulatory functions, or directly support our customers and counterparties.
Added
During a shutdown, federal agencies such as the Internal Revenue Service, Small Business Administration, and various supervisory bodies may suspend or significantly curtail their activities, which can delay loan originations, hinder verification processes, impede regulatory approvals, and reduce the availability of government guaranteed lending programs.
Added
A shutdown may also impair the financial capacity of borrowers who depend on federal salaries, contracts, reimbursements, or benefit programs, including government employees, federal contractors, and recipients of government-funded services. Reduced or delayed income to these borrowers could increase delinquencies, reduce loan demand, negatively affect deposit inflows, and increase our credit risk exposure.
Added
In addition, disruptions to federal economic data releases or fiscal operations may create volatility in financial markets, affecting interest rates, liquidity conditions, and the valuation of securities in our investment portfolio.
Added
Difficulties associated with potential acquisitions that may result from these factors could have a material adverse effect on our business, financial condition and results of operations.
Added
Most recently, in connection with successive failures by the U.S. government to reverse the trend of large annual fiscal deficits and growing interest costs, Moody's lowered its long-term issuer credit rating on the U.S. from Aaa to Aa1.
Added
Changes in Accounting Standards Could Materially Impact Our Financial Statements From time to time, accounting standards setters change the financial accounting and reporting standards that govern the preparation of our financial statements. These changes can be difficult to predict and can materially impact how we record and report our financial condition and results of operations.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe also engage third party security experts to support our cybersecurity threat and incident response management and maintain information security risk insurance coverage. 25 Table of Contents We engage with a range of external experts, including cybersecurity assessors, consultants, auditors, and legal counsel in evaluating and testing our risk management systems.
Biggest changeWe engage with a range of external experts, including cybersecurity assessors, consultants, auditors, and legal counsel in evaluating and testing our risk management systems. This enables us to leverage specialized knowledge and insights, ensuring our cybersecurity strategies and processes remain current.
In the past three years, we have not experienced any material computer data security breaches as a result of a compromise of our information systems and we are not aware of any significant cybersecurity breach or attack that had a material impact on our business or operating results to date.
In the past three years, we have not experienced any material computer data security breaches as a result of a compromise of our information systems and we are not aware of any significant cybersecurity breach or attack that had a material impact on our business or operating results.
Specifically, the Risk Committee is responsible for overseeing our information security program, including management’s actions to identify, assess, mitigate, and remediate material cyber issues and risks. Our Chief Information Security Officer ("CISO") provides quarterly reports to the Risk Committee regarding information security programs, key enterprise cyber initiatives, and significant cybersecurity and privacy incidents.
Specifically, the Risk Committee is responsible for overseeing our information security program, including management’s actions to identify, assess, mitigate, and remediate material cyber issues and risks. Our Chief Information Security Officer ("CISO") provides quarterly reports to the Risk 25 Table of Contents Committee regarding information security programs, key enterprise cyber initiatives, and significant cybersecurity and privacy incidents.
We use the findings of these exercises to improve our practices, procedures, and technologies.
We use the findings of these exercises to improve our practices, procedures, and technologies. We also engage third party security experts to support our cybersecurity threat and incident response management and maintain information security risk insurance coverage.
Removed
This enables us to leverage specialized knowledge and insights, ensuring our cybersecurity strategies and processes remain current.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeFirst Commonwealth Bank has 124 community banking offices, of which 45 are leased and 79 are owned. We also lease two mortgage loan production offices, three corporate loan production offices and an office for our equipment finance business.
Biggest changeFirst Commonwealth Bank has 126 community banking offices, of which 47 are leased and 79 are owned. We also lease seven Business Centers in Canfield, Canton, Hudson, Independence and Lewis Center, Ohio and Pittsburgh and Berwyn, Pennsylvania.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeMontgomery, age 57, has served as the Executive Vice President of Business Integration of First Commonwealth Bank since May 2011. He oversees First Commonwealth’s product development and assumed oversight of First Commonwealth’s technology and operations functions in July 2012.
Biggest changeHe oversees First Commonwealth’s product development and assumed oversight of First Commonwealth’s technology and operations functions in July 2012. He served as Senior Vice President/Business Integration of First Commonwealth Bank from September 2007 until May 2011 and previously held positions in the technology, operations, audit and marketing areas. T.
Riggle has been responsible for the daily operations of the Human Resources function and was actively involved in the establishment and development of a centralized corporate human resources function within the Company. Brian J. Sohocki, age 45, has served as Executive Vice President / Chief Credit Officer since August 2024. Mr. Sohocki has been with First Commonwealth since 2010.
Riggle has been responsible for the daily operations of the Human Resources function and was actively involved in the establishment and development of a centralized corporate human resources function within the Company. Brian J. Sohocki, age 46, has served as Executive Vice President / Chief Credit Officer since August 2024. Mr. Sohocki has been with First Commonwealth since 2010.
Reske worked at the Board of Governors of the Federal Reserve System in Washington, DC and at the Federal Reserve Bank of Boston. Carrie L. Riggle, age 55, has served as Executive Vice President / Human Resources since March 1, 2013. Ms. Riggle has been with First Commonwealth since 1991. Over the course of her tenure, Ms.
Reske worked at the Board of Governors of the Federal Reserve System in Washington, DC and at the Federal Reserve Bank of Boston. Carrie L. Riggle, age 56, has served as Executive Vice President / Human Resources since March 1, 2013. Ms. Riggle has been with First Commonwealth since 1991. Over the course of her tenure, Ms.
Reske, age 61, joined First Commonwealth Financial Corporation as Executive Vice President, Chief Financial Officer and Treasurer on April 28, 2014. Prior to joining First Commonwealth, Mr. Reske served as Executive Vice President, Chief Financial Officer, and Treasurer at United Community Financial Corporation in Youngstown, Ohio from 2008 until April 2014. Mr.
Reske, age 62, joined First Commonwealth Financial Corporation as Executive Vice President, Chief Financial Officer and Treasurer on April 28, 2014. Prior to joining First Commonwealth, Mr. Reske served as Executive Vice President, Chief Financial Officer, and Treasurer at United Community Financial Corporation in Youngstown, Ohio from 2008 until April 2014. Mr.
Mine Safety Disclosures Not applicable. 26 Table of Contents Executive Officers of First Commonwealth Financial Corporation The name, age and principal occupation for each of the executive officers of First Commonwealth Financial Corporation as of December 31, 2024 is set forth below: Jane Grebenc, age 66, has served as Executive Vice President and Chief Revenue Officer of First Commonwealth Financial Corporation and President of First Commonwealth Bank since May 31, 2013.
Mine Safety Disclosures Not applicable. 26 Table of Contents Executive Officers of First Commonwealth Financial Corporation The name, age and principal occupation for each of the executive officers of First Commonwealth Financial Corporation as of December 31, 2025 is set forth below: Jane Grebenc, age 67, has served as Executive Vice President and Chief Revenue Officer of First Commonwealth Financial Corporation and President of First Commonwealth Bank since May 31, 2013.
He formerly served as Corporate Banking Executive. Mr. McCuen has been with First Commonwealth since 2023. Before joining First Commonwealth, Mr. McCuen was Market President and Commercial Sales Leader for Key Bank's Southwest Ohio area since 2017. Mr. McCuen's past experience includes co-leading the middle market segment at PNC, leading Bank integrations, and various Corporate Banking leadership roles. Norman J.
McCuen has been with First Commonwealth since 2023. Before joining First Commonwealth, Mr. McCuen was Market President and Commercial Sales Leader for Key Bank's Southwest Ohio area since 2017. Mr. McCuen's past experience includes co-leading the middle market segment at PNC, leading Bank integrations, and various Corporate Banking leadership roles. Linda D.
Price served as President of First Commonwealth Bank from November 2007 to May 2013. From January 1, 2012 to March 7, 2012, he served as Interim President and Chief Executive Officer of First Commonwealth Financial Corporation.
From January 1, 2012 to March 7, 2012, he served as Interim President and Chief Executive Officer of First Commonwealth Financial Corporation.
He formerly served in roles including Deputy Chief Credit Officer and C&I Group Manager. During that time, Sohocki was instrumental in the development of First Commonwealth's Sponsor Finance Group and Commercial and Industrial loan growth initiative. Matthew C. Tomb, age 48, serves as Executive Vice President and General Counsel of First Commonwealth Financial Corporation since November 2010.
He formerly served in roles including Deputy Chief Credit Officer and C&I Group Manager. During that time, Sohocki was instrumental in the development of First Commonwealth's Sponsor Finance Group and Commercial and Industrial loan growth initiative. 27 Table of Contents Matthew C.
He previously served as Chief Risk Officer and General Counsel from November 2010 to December 31, 2024, and as Senior Vice President / Legal and Compliance since September 2007. Before joining First Commonwealth, Mr. Tomb practiced law with Sherman & Howard L.L.C. in Denver, Colorado. 27 Table of Contents PART II
Tomb, age 49, serves as Executive Vice President and General Counsel of First Commonwealth Financial Corporation since November 2010. He previously served as Chief Risk Officer and General Counsel from November 2010 to December 31, 2024, and as Senior Vice President / Legal and Compliance since September 2007. Before joining First Commonwealth, Mr.
He served as Senior Vice President/Business Integration of First Commonwealth Bank from September 2007 until May 2011 and previously held positions in the technology, operations, audit and marketing areas. T. Michael Price, age 62, has served as President and Chief Executive Officer of First Commonwealth Financial Corporation and Chief Executive Officer of First Commonwealth Bank since March 2012. Mr.
Michael Price, age 63, has served as President and Chief Executive Officer of First Commonwealth Financial Corporation and Chief Executive Officer of First Commonwealth Bank since March 2012. Mr. Price served as President of First Commonwealth Bank from November 2007 to May 2013.
Removed
Leonard V. Lombardi, age 65, has served as Executive Vice President and Chief Audit Executive of First Commonwealth Financial Corporation since January 1, 2009. He was formerly Senior Vice President / Loan Review and Audit Manager. Michael P. McCuen, age 62, has served as Executive Vice President and Chief Lending Officer since July 2024.
Added
Lee E. Lyon II, age 61, has served as Executive Vice President and Chief Audit Executive since October 2025. He previously served as the Chief Risk and Operations Officer of CenterBank, which was acquired by First Commonwealth in 2025. Before joining CenterBank, Mr.
Added
Lyon held various positions at Fifth Third Bancorp, including Director of Consumer Operational Risk Management, Chief Risk Officer Mortgage Banking Division and Internal Audit Manager. Michael P. McCuen, age 63, has served as Executive Vice President and Chief Banking Officer since August 2025. He formerly served as Chief Lending Officer and Corporate Banking Executive. Mr.
Added
Metzmaier, age 57, has served as Executive Vice President and Chief Risk Officer since January 2025. She joined First Commonwealth as Chief Compliance Officer in 2011 before being promoted to Deputy Chief Risk Office/Chief Compliance Officer in 2019.
Added
Prior to joining First Commonwealth, Metzmaier served in auditing and compliance leadership roles at Fidelity Bank, Office of the Comptroller of the Currency and Merchants National Bank of Kittanning from 1990-2011. Norman J. Montgomery, age 58, has served as the Executive Vice President of Business Integration of First Commonwealth Bank since May 2011.
Added
Tomb practiced law with Sherman & Howard L.L.C. in Denver, Colorado. 28 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+0 added−0 removed3 unchanged
Biggest changePeriod High Sale Low Sale Cash Dividends Per Share 2024 First Quarter $ 15.56 $ 12.84 $ 0.125 Second Quarter 14.24 12.53 0.130 Third Quarter 18.60 13.71 0.130 Fourth Quarter 19.41 16.24 0.130 Period High Sale Low Sale Cash Dividends Per Share 2023 First Quarter $ 16.43 $ 12.36 $ 0.120 Second Quarter 14.48 11.46 0.125 Third Quarter 14.54 11.94 0.125 Fourth Quarter 15.81 11.55 0.125 Federal and state regulations contain restrictions on the ability of First Commonwealth to pay dividends.
Biggest changePeriod High Sale Low Sale Cash Dividends Per Share 2025 First Quarter $ 17.13 $ 15.37 $ 0.130 Second Quarter 16.35 14.08 0.135 Third Quarter 18.02 16.07 0.135 Fourth Quarter 17.57 15.29 0.135 Period High Sale Low Sale Cash Dividends Per Share 2024 First Quarter $ 15.56 $ 12.84 $ 0.125 Second Quarter 14.24 12.53 0.130 Third Quarter 18.60 13.71 0.130 Fourth Quarter 19.41 16.24 0.130 Federal and state regulations contain restrictions on the ability of First Commonwealth to pay dividends.
For information regarding restrictions on dividends, see Part I, Item 1 “Business—Supervision and Regulation—Dividends” and Part II, Item 8, “Financial Statements and Supplementary Data—Note 25, Regulatory Restrictions and Capital Adequacy.” In addition, under the terms of the capital securities issued by First Commonwealth Capital Trust II and III, First Commonwealth could not pay dividends on its common stock if First Commonwealth deferred payments on the junior subordinated debt securities that provide the cash flow for the payments on the capital securities. 28 Table of Contents The following five-year performance graph compares the cumulative total shareholder return (assuming reinvestment of dividends) on First Commonwealth’s common stock to the S&P U.S.
For information regarding restrictions on dividends, see Part I, Item 1 “Business—Supervision and Regulation—Dividends” and Part II, Item 8, “Financial Statements and Supplementary Data—Note 25, Regulatory Restrictions and Capital Adequacy.” In addition, under the terms of the capital securities issued by First Commonwealth Capital Trust II and III, First Commonwealth could not pay dividends on its common stock if First Commonwealth deferred payments on the junior subordinated debt securities that provide the cash flow for the payments on the capital securities. 29 Table of Contents The following five-year performance graph compares the cumulative total shareholder return (assuming reinvestment of dividends) on First Commonwealth’s common stock to the S&P U.S.
BMI Banks Index and the Russell 2000 Index. The stock performance graph assumes $100 was invested on December 31, 2019, and the cumulative return is measured as of each subsequent fiscal year end.
BMI Banks Index and the Russell 2000 Index. The stock performance graph assumes $100 was invested on December 31, 2020, and the cumulative return is measured as of each subsequent fiscal year end.
These policies have been reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable NYSE listing standards. 29 Table of Contents ITEM 6. [Reserved] 30 Table of Contents
These policies have been reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable NYSE listing standards. 30 Table of Contents ITEM 6. [Reserved] 31 Table of Contents
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities First Commonwealth is listed on the NYSE under the symbol “FCF.” As of December 31, 2024, there were approximately 4,975 holders of record of First Commonwealth’s common stock.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities First Commonwealth is listed on the NYSE under the symbol “FCF.” As of December 31, 2025, there were approximately 4,771 holders of record of First Commonwealth’s common stock.
Month Ending: Total Number of Shares Purchased Average Price Paid per Share (or Unit) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs October 31, 2024 455,236 $ 16.56 455,236 431,411 November 30, 2024 — — — 376,654 December 31, 2024 21,743 17.34 21,743 396,895 Total 476,979 $ 16.60 476,979 (1) Remaining number of shares approved under the Plan is based on the market value of the Company's common stock of $16.44 as of October 31, 2024, $18.83 as of November 30, 2024 and $16.92 as of December 31, 2024.
Month Ending: Total Number of Shares Purchased Average Price Paid per Share (or Unit) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs October 31, 2025 47,116 $ 16.89 47,116 1,301,151 November 30, 2025 1,269,618 15.77 1,269,618 — December 31, 2025 115,652 17.19 115,652 1,364,851 Total 1,432,386 $ 15.93 1,432,386 (1) Remaining number of shares approved under the Plan is based on the market value of the Company's common stock of $15.29 as of October 31, 2025, $16.25 as of November 30, 2025 and $16.86 as of December 31, 2025.
BMI Banks Index 100.00 87.24 118.61 98.38 107.32 143.68 Unregistered Sales of Equity Securities and Use of Proceeds The following table details the amount of shares repurchased during the fourth quarter of 2024.
BMI Banks Index 100.00 135.97 112.77 123.02 164.70 211.47 Unregistered Sales of Equity Securities and Use of Proceeds The following table details the amount of shares repurchased during the fourth quarter of 2025.
Period Ending Index 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 First Commonwealth Financial Corporation 100.00 79.11 120.20 107.81 123.66 140.16 Russell 2000 Index 100.00 119.96 137.74 109.59 128.14 142.93 S&P U.S.
Period Ending Index 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 First Commonwealth Financial Corporation 100.00 151.93 136.27 156.31 177.17 182.49 Russell 2000 Index 100.00 114.82 91.35 106.80 119.14 134.40 S&P U.S.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

133 edited+40 added−29 removed56 unchanged
Biggest changeFollowing is the gap analysis as of December 31: 2024 0-90 Days 91-180 Days 181-365 Days Cumulative 0-365 Days Over 1 Year Through 5 Years Over 5 Years (dollars in thousands) Loans and leases $ 3,668,849 $ 423,523 $ 738,672 $ 4,831,044 $ 3,212,002 $ 851,465 Investments 57,039 50,445 119,475 226,959 675,061 771,365 Other interest-earning assets 27,160 — — 27,160 — 1,198 Total interest-sensitive assets (ISA) 3,753,048 473,968 858,147 5,085,163 3,887,063 1,624,028 Certificates of deposit 681,794 410,573 552,392 1,644,759 104,383 1,218 Other deposits 5,677,938 — — 5,677,938 — — Borrowings 159,245 211 423 159,879 179,508 — Total interest-sensitive liabilities (ISL) 6,518,977 410,784 552,815 7,482,576 283,891 1,218 Gap $ (2,765,929) $ 63,184 $ 305,332 $ (2,397,413) $ 3,603,172 $ 1,622,810 ISA/ISL 0.58 1.15 1.55 0.68 13.69 1,333.36 Gap/Total assets 23.88 % 0.55 % 2.64 % 20.69 % 31.10 % 14.01 % 51 Table of Contents 2023 0-90 Days 91-180 Days 181-365 Days Cumulative 0-365 Days Over 1 Year Through 5 Years Over 5 Years (dollars in thousands) Loans and leases $ 3,619,166 $ 446,373 $ 756,190 $ 4,821,729 $ 3,137,007 $ 945,896 Investments 72,358 44,567 97,544 214,469 606,670 733,418 Other interest-earning assets 20,440 — — 20,440 1,117 — Total interest-sensitive assets (ISA) 3,711,964 490,940 853,734 5,056,638 3,744,794 1,679,314 Certificates of deposit 271,662 210,793 569,507 1,051,962 235,562 974 Other deposits 5,515,919 — — 5,515,919 — — Borrowings 726,850 207 415 727,472 53,069 224 Total interest-sensitive liabilities (ISL) 6,514,431 211,000 569,922 7,295,353 288,631 1,198 Gap $ (2,802,467) $ 279,940 $ 283,812 $ (2,238,715) $ 3,456,163 $ 1,678,116 ISA/ISL 0.57 2.33 1.50 0.69 12.97 1,401.76 Gap/Total assets 24.46 % 2.44 % 2.48 % 19.54 % 30.16 % 14.64 % Gap analysis has limitations due to the static nature of the model, which holds volumes and consumer behaviors constant in all economic and interest rate scenarios.
Biggest changeThe level of First Commonwealth's ratio is largely driven by the modeling of interest-bearing non-maturity deposits, which are included in the analysis as repricing within one year. 52 Table of Contents Following is the gap analysis as of December 31: 2025 0-90 Days 91-180 Days 181-365 Days Cumulative 0-365 Days Over 1 Year Through 5 Years Over 5 Years (dollars in thousands) Loans and leases $ 3,962,518 $ 534,440 $ 846,281 $ 5,343,239 $ 3,308,592 $ 724,461 Investments 83,620 64,581 134,135 282,336 676,118 657,200 Other interest-earning assets 75,812 — — 75,812 — 1,270 Total interest-sensitive assets (ISA) 4,121,950 599,021 980,416 5,701,387 3,984,710 1,382,931 Certificates of deposit 770,770 629,285 367,335 1,767,390 72,102 916 Other deposits 6,037,275 — — 6,037,275 — — Borrowings 227,167 215 127,431 354,813 51,693 — Total interest-sensitive liabilities (ISL) 7,035,212 629,500 494,766 8,159,478 123,795 916 Gap $ (2,913,262) $ (30,479) $ 485,650 $ (2,458,091) $ 3,860,915 $ 1,382,015 ISA/ISL 0.59 0.95 1.98 0.70 32.19 1,509.75 Gap/Total assets 23.60 % 0.25 % 3.93 % 19.91 % 31.28 % 11.20 % 2024 0-90 Days 91-180 Days 181-365 Days Cumulative 0-365 Days Over 1 Year Through 5 Years Over 5 Years (dollars in thousands) Loans and leases $ 3,668,849 $ 423,523 $ 738,672 $ 4,831,044 $ 3,212,002 $ 851,465 Investments 57,039 50,445 119,475 226,959 675,061 771,365 Other interest-earning assets 27,160 — — 27,160 — 1,198 Total interest-sensitive assets (ISA) 3,753,048 473,968 858,147 5,085,163 3,887,063 1,624,028 Certificates of deposit 681,794 410,573 552,392 1,644,759 104,383 1,218 Other deposits 5,677,938 — — 5,677,938 — — Borrowings 159,245 211 423 159,879 179,508 — Total interest-sensitive liabilities (ISL) 6,518,977 410,784 552,815 7,482,576 283,891 1,218 Gap $ (2,765,929) $ 63,184 $ 305,332 $ (2,397,413) $ 3,603,172 $ 1,622,810 ISA/ISL 0.58 1.15 1.55 0.68 13.69 1,333.36 Gap/Total assets 23.88 % 0.55 % 2.64 % 20.69 % 31.10 % 14.01 % Gap analysis has limitations due to the static nature of the model, which holds volumes and consumer behaviors constant in all economic and interest rate scenarios.
Commercial banking services include commercial lending and leasing, small and high-volume business checking accounts, on-line account management services, ACH origination, payroll direct deposit, commercial cash management services and repurchase agreements. We also provide a variety of trust and asset management services and a full complement of auto, home and business insurance as well as term life insurance.
Commercial banking services include commercial lending and leasing, small and high-volume business checking accounts, on-line account management services, ACH origination, payroll direct deposit, commercial cash management services and repurchase agreements. We also provide trust and asset management services and a full complement of auto, home and business insurance as well as term life insurance.
In order to identify and manage credit risk, segment and concentration limits are established and approved by our Board of Directors’ Risk Committee in order to maintain alignment with our credit isk appetite, loan strategic plan, loan policy and underwriting guidelines. In addition, our Credit Department completes industry studies to identify potential risk in the portfolio.
In order to identify and manage credit risk, segment and concentration limits are established and approved by our Board of Directors’ Risk Committee in order to maintain alignment with our credit risk appetite, loan strategic plan, loan policy and underwriting guidelines. In addition, our Credit Department completes industry studies to identify potential risk in the portfolio.
Management determines and reviews with the Board of Directors the appropriateness of the allowance on a quarterly basis in accordance with the methodology described below. • Loans are segmented into groups with similar characteristics and risks and an allowance for credit losses is calculated for each segment based on the estimate of credit losses. 31 Table of Contents • The allowance for credit losses is calculated by pooling loans of similar credit risk characteristics and applying a discounted cash flow methodology after incorporating probability of default and loss given default estimates.
Management determines and reviews with the Board of Directors the appropriateness of the allowance on a quarterly basis in accordance with the methodology described below. • Loans are segmented into groups with similar characteristics and risks and an allowance for credit losses is calculated for each segment based on the estimate of credit losses. 32 Table of Contents • The allowance for credit losses is calculated by pooling loans of similar credit risk characteristics and applying a discounted cash flow methodology after incorporating probability of default and loss given default estimates.
Management evaluates the appropriateness of the allowance at least quarterly, and in doing so relies on various factors including, but not limited to, assessment of historical loss experience, contractual payment schedules, prepayment estimates, calculated probability of default and loss given default estimates and forecasts of certain macroeconomic variables, such as unemployment, gross domestic product, housing price index as well as other macroeconomic variables.
Management evaluates the appropriateness of the allowance at least quarterly, and in doing so relies on various factors including, but not limited to, assessment of historical loss experience, contractual payment schedules, prepayment estimates, calculated probability of default and loss given default estimates and forecasts of certain macroeconomic variables, such as unemployment, gross domestic product, housing price index, business bankruptcies as well as other macroeconomic variables.
This decrease can be attributed to a $6.8 million decline in card-related interchange income resulting from the Company being subject to the Durbin Amendment to the Dodd-Frank Act beginning July 1, 2024. The Durbin Amendment is now applicable to the Company because its total assets exceeded $10.0 billion as of December 31, 2023.
This decrease can be attributed to a $6.3 million decline in card-related interchange income resulting from the Company being subject to the Durbin Amendment to the Dodd-Frank Act beginning July 1, 2024. The Durbin Amendment is now applicable to the Company because its total assets exceeded $10.0 billion as of December 31, 2023.
Management's sensitivity analysis of the allowance identified that the model has the highest degree of sensitivity around values used in the economic forecast, specifically national unemployment and gross domestic product. Additionally, there is also a high degree of sensitivity related to estimated prepayment speeds as it is a major driver for the life of loan expectations.
Management's sensitivity analysis of the allowance identified that the model has the highest degree of sensitivity around values used in the economic forecast, specifically national unemployment, gross domestic product and business bankruptcies. Additionally, there is also a high degree of sensitivity related to estimated prepayment speeds, as it is a major driver for the life of loan expectations.
For a description of the methodology used to calculate the allowance for credit losses, please refer to “Critical Accounting Policies and Significant Accounting Estimates—Allowance for Credit Losses.” 46 Table of Contents Investment Portfolio Marketable securities that we hold in our investment portfolio, which are classified as “securities available for sale,” act as a source of liquidity.
For a description of the methodology used to calculate the allowance for credit losses, please refer to “Critical Accounting Policies and Significant Accounting Estimates—Allowance for Credit Losses.” 47 Table of Contents Investment Portfolio Marketable securities that we hold in our investment portfolio, which are classified as “securities available for sale,” act as a source of liquidity.
Probability of default represents an estimate of the likelihood of default and loss given default measures the expected loss upon default. Inputs impacting the expected losses includes a forecast of macroeconomic factors, using a weighted forecast from a nationally recognized firm. • Loans that do not have the same risks and characteristics of the loan pools are individually reviewed.
Probability of default represents an estimate of the likelihood of default and loss given default measures the expected loss upon default. Inputs impacting the expected losses include a forecast of macroeconomic factors, using a weighted forecast from a nationally recognized firm. • Loans that do not have the same risks and characteristics of the loan pools are individually reviewed.
We also generate revenue through fees earned on various services and products that we offer to our customers and, less frequently, through sales of assets, such as loans, investments or properties. These revenue sources are offset by provisions for credit losses on loans, operating expenses and income taxes.
We also generate revenue through fees earned on various services and products that we offer to our customers and through sales of assets, such as loans, investments or properties. These revenue sources are offset by provisions for credit losses on loans, operating expenses and income taxes.
The following table summarizes commercial real estate loans by the location of the properties by which they are collateralized as of December 31, 2024. Some loans are collateralized by multiple properties spread over various states. In those instances the loan is included below based on the location of the primary property collateralizing the loan.
The following table summarizes commercial real estate loans by the location of the properties by which they are collateralized as of December 31, 2025. Some loans are collateralized by multiple properties spread over various states. In those instances the loan is included below based on the location of the primary property collateralizing the loan.
For additional information related to these segments, including credit quality, see Note 9 "Loans and Leases and Allowance for Credit Losses" of the Consolidated Financial Statements. 44 Table of Contents Nonperforming Loans Nonperforming loans include nonaccrual loans and restructured loans. Nonaccrual loans represent loans on which interest accruals have been discontinued.
For additional information related to these segments, including credit quality, see Note 9 "Loans and Leases and Allowance for Credit Losses" of the Consolidated Financial Statements. 45 Table of Contents Nonperforming Loans Nonperforming loans include nonaccrual loans and restructured loans. Nonaccrual loans represent loans on which interest accruals have been discontinued.
In addition, see Note 10 “Commitments and Letters of Credit” for detail related to our off-balance sheet commitments to extend credit, financial standby letters of credit, performance standby letters of credit and commercial letters of credit as of December 31, 2024.
In addition, see Note 10 “Commitments and Letters of Credit” for detail related to our off-balance sheet commitments to extend credit, financial standby letters of credit, performance standby letters of credit and commercial letters of credit as of December 31, 2025.
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis represents an overview of the financial condition and the results of operations of First Commonwealth and its subsidiaries, as of and for the years ended December 31, 2024, and 2023.
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis represents an overview of the financial condition and the results of operations of First Commonwealth and its subsidiaries, as of and for the years ended December 31, 2025, and 2024.
Commercial real estate comprises 35% of our total loan portfolio. Commercial real estate loans are collateralized by real estate properties including, but not limited to, multifamily properties, office, retail, hotels and student housing.
Commercial real estate comprises 33% of our total loan portfolio. Commercial real estate loans are collateralized by real estate properties including, but not limited to, multifamily properties, office, retail, hotels and student housing.
Liquidity provided from sales, calls and maturities was utilized to fund growth in the loan portfolio or reinvested into investment securities and interest-bearing deposits with banks. 47 Table of Contents Following is a detailed schedule of the amortized cost of securities held to maturity as of December 31: 2024 2023 2022 (dollars in thousands) Obligations of U.S.
Liquidity provided from sales, calls and maturities was utilized to fund growth in the loan portfolio or reinvested into investment securities and interest-bearing deposits with banks. 48 Table of Contents Following is a detailed schedule of the amortized cost of securities held to maturity as of December 31: 2025 2024 2023 (dollars in thousands) Obligations of U.S.
Loans with these term commitments will be moved to the commercial real estate category when the construction phase of the project is completed. First Commonwealth has a legal lending limit of $190.3 million to any one borrower or closely related group of borrowers, but has established lower thresholds for credit risk management.
Loans with these term commitments will be moved to the commercial real estate category when the construction phase of the project is completed. First Commonwealth has a legal lending limit of $204.4 million to any one borrower or closely related group of borrowers, but has established lower thresholds for credit risk management.
As previously noted, portfolio segment limits are approved by our Board of Directors' Risk Committee. These segment limits incorporate loan commitments and are based off of total Tier 1 capital plus the allowable allowance for credit losses.
Portfolio segment limits are approved by our Board of Directors' Risk Committee. These segment limits incorporate loan commitments and are based off of total Tier 1 capital plus the allowable allowance for credit losses.
The following gap analysis compares the difference between the amount of interest-earning assets and interest-bearing liabilities subject to repricing over a period of time. The ratio of rate sensitive assets to rate sensitive liabilities repricing within a one-year period was 0.68 and 0.69 at December 31, 2024 and 2023, respectively.
The following gap analysis compares the difference between the amount of interest-earning assets and interest-bearing liabilities subject to repricing over a period of time. The ratio of rate sensitive assets to rate sensitive liabilities repricing within a one-year period was 0.70 and 0.68 at December 31, 2025 and 2024, respectively.
After incorporating the impact of our cash flow hedges that convert the interest rate on $425.0 million of our 1-month Secured Overnight Financing Rate ("SOFR") based loans to fixed rates, the variable and adjustable interest rates would account for 46% of our loan portfolio.
After incorporating the impact of our cash flow hedges that convert the interest rate on $175.0 million of our 1-month Secured Overnight Financing Rate ("SOFR") based loans to fixed rates, the variable and adjustable interest rates would account for 47% of our loan portfolio.
Additionally for loans with exposure over $1.0 million, the office portfolio has an average loan to value of 61.0% compared to internal guidelines of 60-75% depending on property class. Our current measure is based off of the most recent appraisal on file, the majority of which are from origination.
Additionally, for loans with exposure over $1.0 million, the office portfolio has a weighted average loan to value of 54% compared to internal guidelines of 60-75% depending on property class. Our current measure is based off of the most recent appraisal on file, the majority of which are from origination.
To compare the tax exempt asset yields to taxable yields, amounts are adjusted to the pretax equivalent amounts based on the marginal corporate federal income tax rate of 21%. The taxable equivalent adjustment to net interest income for 2024 was $1.3 million compared to $1.2 million in 2023.
To compare the tax exempt asset yields to taxable yields, amounts are adjusted to the pretax equivalent amounts based on the marginal corporate federal income tax rate of 21%. The taxable equivalent adjustment to net interest income for 2025 was $1.4 million compared to $1.3 million in 2024.
In the second quarter of 2024, after considering the current environment and potential risks related to the office portfolio, the segment limit for the office portfolio was decreased from 65% to 50%, with the actual segment concentration at 40% as of December 31, 2024.
In the second quarter of 2024, after considering the current environment and potential risks related to the office portfolio, the segment limit for the office portfolio was decreased from 65% to 50%, with the actual segment concentration at 32.4% as of December 31, 2025.
Repricing risk arises from differences in the cash flow or repricing between 50 Table of Contents asset and liability portfolios. Basis risk arises when asset and liability portfolios are related to different market rate indices, which do not always change by the same amount.
Repricing risk arises from differences in the cash flow or repricing between asset and liability portfolios. Basis risk arises when asset and liability portfolios are related to different market rate indices, which do not always change by the same amount.
On an annual basis, the Credit Department also reviews the commercial real estate portfolio as a whole, along with underwriting practices and loan level stress testing procedures, to enhance risk management practices and monitor commercial real estate concentrations.
On an annual basis, the Credit Department also reviews the commercial real estate portfolio as a whole, along with underwriting practices and loan level stress testing procedures, to enhance risk management practices and monitor commercial real estate 54 Table of Contents concentrations.
The probable risk of loss on these loans is evaluated by comparing the loan balance to the estimated fair value of any underlying collateral or the present value of projected future cash flows. Losses or specifically assigned allowance for credit losses are recognized where appropriate. Nonperforming loans increased $22.0 million at December 31, 2024 compared to the prior year.
The probable risk of loss on these loans is evaluated by comparing the loan balance to the estimated fair value of any underlying collateral or the present value of projected future cash flows. Losses or specifically assigned allowance for credit losses are recognized where appropriate. Nonperforming loans increased $30.3 million at December 31, 2025 compared to the prior year.
For example, the results in a declining rate scenario could be affected by the model's use of an assumed interest rate floor of zero. For the years 2024 and 2023, the cost of our interest-bearing liabilities averaged 2.83% and 2.03%, respectively, and the yield on our average interest-earning assets, on a fully taxable equivalent basis, averaged 5.62% and 5.23%, respectively.
For example, the results in a declining rate scenario could be affected by the model's use of an assumed interest rate floor of zero. For the years 2025 and 2024, the cost of our interest-bearing liabilities averaged 2.55% and 2.83%, respectively, and the yield on our average interest-earning assets, on a fully taxable equivalent basis, averaged 5.70% and 5.62%, respectively.
Also contributing to the increase in yield on interest-earning assets was th e yield on the investment portfolio, which increased by 90 basis points compared to the prior year, primarily as new volume rates were higher than the portfolio yield. The average investment portfolio balance increased $276.0 million as growth in average deposits exceeded the funding needs for loan growth.
Also contributing to the increase in yield on interest-earning assets was th e yield on the investment portfolio, which increased by 32 basis points compared to the prior year, primarily as new volume rates were higher than the portfolio yield. The average investment portfolio balance increased $60.4 million as growth in average deposits exceeded the funding needs for loan growth.
The allowance for credit losses increased $1.2 million from December 31, 2023 to December 31, 2024. The allowance for credit losses as a percentage of end-of-period loans and leases outstanding was 1.32% and 1.31% at December 31, 2024 and 2023, respectively. The allowance for credit losses includes both a general reserve for performing loans and reserves for individually analyzed loans.
The allowance for credit losses increased $6.9 million from December 31, 2024 to December 31, 2025. The allowance for credit losses as a percentage of end-of-period loans and leases outstanding was 1.32% at both December 31, 2025 and 2024, respectively. The allowance for credit losses includes both a general reserve for performing loans and reserves for individually analyzed loans.
The following table presents an analysis of the potential sensitivity of our annual net interest income to gradual changes in interest rates over a 12-month time frame as compared with net interest income if rates remained unchanged and there are no changes in balance sheet categories.
The impact of the sensitivity to changes in interest rates is provided in the table below. 53 Table of Contents The following table presents an analysis of the potential sensitivity of our annual net interest income to gradual changes in interest rates over a 12-month time frame as compared with net interest income if rates remained unchanged and there are no changes in balance sheet categories.
Net interest income comprises a majority of our revenue (net interest income before provision expense plus noninterest income) at 79% and 80% for the years ended December 31, 2024 and 2023, respectively.
Net interest income comprises a majority of our revenue (net interest income before provision expense plus noninterest income) at 81% and 79% for the years ended December 31, 2025 and 2024, respectively.
First Commonwealth also maintains a reserve for unfunded loan commitments and letters of credit based upon credit risk and probability of funding. The reserve totaled $4.1 million at December 31, 2024 and is classified in “Other liabilities” on the Consolidated Statements of Financial Condition.
First Commonwealth also maintains a reserve for unfunded loan commitments and letters of credit based upon credit risk and probability of funding. The reserve totaled $8.2 million at December 31, 2025 and is classified in “Other liabilities” on the Consolidated Statements of Financial Condition.
Additional detail on credit risk is included in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under “Provision for Credit Losses,” “Allowance for Credit Losses" and "Credit Risk.” Provision for credit losses on loans and leases as a percentage of net charge-offs increased to 103.8% for the year ended December 31, 2024 from 23.6% for the year ended December 31, 2023.
Additional detail on credit risk is included in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under “Provision for Credit Losses,” “Allowance for Credit Losses" and "Credit Risk.” Provision for credit losses on loans and leases as a percentage of net charge-offs decreased to 99.7% for the year ended December 31, 2025 from 103.8% for the year ended December 31, 2024.
Higher levels of interest-earning assets resulted in an increase of $22.8 million in interest income, and changes in the volume and mix of interest-bearing liabilities increased interest expense by $21.3 million, primarily due to growth in time and savings deposits.
Higher levels of interest-earning assets resulted in an increase of $23.8 million in interest income, and changes in the volume and mix of interest-bearing liabilities increased interest expense by $5.4 million, primarily due to growth in time and savings deposits.
The allowance for credit losses as a percentage of nonperforming loans was 193.5% and 298.2% at December 31, 2024 and 2023, respectively. The allowance for credit losses represents management’s estimate of expected losses in the loan portfolio at a specific point in time.
The allowance for credit losses as a percentage of nonperforming loans was 137.1% and 193.5% at December 31, 2025 and 2024, respectively. The allowance for credit losses represents management’s estimate of expected losses in the loan portfolio at a specific point in time.
However, we do not anticipate liquidating the investments prior to maturity. Following is a detailed schedule of the amortized cost of securities available for sale as of December 31: 2024 2023 2022 (dollars in thousands) Obligations of U.S. Government Agencies: Mortgage-Backed Securities—Residential $ 3,096 $ 3,565 $ 4,127 Mortgage-Backed Securities—Commercial 779,232 512,979 324,306 Obligations of U.S.
However, we do not anticipate liquidating the investments prior to maturity. Following is a detailed schedule of the amortized cost of securities available for sale as of December 31: 2025 2024 2023 (dollars in thousands) Obligations of U.S. Government Agencies: Mortgage-Backed Securities—Residential $ 2,638 $ 3,096 $ 3,565 Mortgage-Backed Securities—Commercial 701,572 779,232 512,979 Obligations of U.S.
The level of deposits during any period is sometimes influenced by factors outside of management’s control, such as the level of short-term and long-term market interest rates and yields offered on competing investments, such as money market mutual funds. Deposits increased $485.7 million during 2024, and comprised 95% and 91% of total liabilities at December 31, 2024 and 2023, respectively.
The level of deposits during any period is sometimes influenced by factors outside of management’s control, such as the level of short-term and long-term market interest rates and yields offered on competing investments, such as money market mutual funds. Deposits increased $573.0 million during 2025, and comprised 95% of total liabilities at both December 31, 2025 and 2024.
Allowance for Credit Losses Following is a summary of the allocation of the allowance for credit losses at December 31: 2024 2023 2022 2021 2020 Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) (dollars in thousands) Commercial, financial, agricultural and other $ 29,131 19 % $ 27,996 17 % $ 22,650 16 % $ 18,093 17 % $ 17,187 23 % Real estate construction 6,030 5 7,418 7 8,822 7 4,220 7 7,966 6 Residential real estate 22,396 26 23,901 27 21,412 29 12,625 28 14,358 26 Commercial real estate 40,232 35 37,071 34 28,804 31 33,376 33 41,953 33 Loans to individuals 21,117 15 21,332 15 21,218 17 24,208 15 19,845 12 Total $ 118,906 $ 117,718 $ 102,906 $ 92,522 $ 101,309 Allowance for credit losses as percentage of end-of-period loans and leases outstanding 1.32 % 1.31 % 1.35 % 1.35 % 1.50 % (a) Represents the ratio of loans in each category to total loans.
Allowance for Credit Losses Following is a summary of the allocation of the allowance for credit losses at December 31: 2025 2024 2023 2022 2021 Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) Allowance Amount % (a) (dollars in thousands) Commercial, financial, agricultural and other $ 38,149 22 % $ 29,131 19 % $ 27,996 17 % $ 22,650 16 % $ 18,093 17 % Real estate construction 7,808 5 6,030 5 7,418 7 8,822 7 4,220 7 Residential real estate 21,629 25 22,396 26 23,901 27 21,412 29 12,625 28 Commercial real estate 40,271 33 40,232 35 37,071 34 28,804 31 33,376 33 Loans to individuals 17,911 15 21,117 15 21,332 15 21,218 17 24,208 15 Total $ 125,768 $ 118,906 $ 117,718 $ 102,906 $ 92,522 Allowance for credit losses as percentage of end-of-period loans and leases outstanding 1.32 % 1.32 % 1.31 % 1.35 % 1.35 % (a) Represents the ratio of loans in each category to total loans.
For the year ended December 31, 2023, $9.1 million in accretion of purchase accounting marks benefited the yield on interest-earning assets by nine basis points. As of December 31, 2024, 51% of our loan portfolio had variable or adjustable interest rates and 49% had fixed interest rates.
For the year ended December 31, 2024, $7.5 million in accretion of purchase accounting marks benefited the yield on interest-earning assets by seven basis points. As of December 31, 2025, 49% of our loan portfolio had variable or adjustable interest rates and 51% had fixed interest rates.
Net interest income was negatively impacted by a decrease of $147.3 million in average net free funds at December 31, 2024 as compared to December 31, 2023. Average net free funds are the excess of noninterest-bearing demand deposits, other noninterest-bearing liabilities and shareholders’ equity over noninterest-earning assets.
Net interest income was positively impacted by a decrease of $136.8 million in average net free funds at December 31, 2025 as compared to December 31, 2024. Average net free funds are the excess of noninterest-bearing demand deposits, other noninterest-bearing liabilities and shareholders’ equity over noninterest-earning assets.
Refer to Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K filed with the SEC on February 29, 2024 for a discussion and analysis of the factors that affected periods prior to 2024.
Refer to Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K filed with the SEC on March 2, 2026 for a discussion and analysis of the factors that affected periods prior to 2025.
However, the gap analysis incorporates only the level of interest-earning assets and interest-bearing liabilities and not the sensitivity each has to changes in interest rates. The impact of the sensitivity to changes in interest rates is provided in the table below.
However, the gap analysis incorporates only the level of interest-earning assets and interest-bearing liabilities and not the sensitivity each has to changes in interest rates.
Net interest income and the net interest margin are affected by both changes in the level of interest rates and the amount and composition of interest-earning assets and interest-bearing liabilities. The growth in interest-earning assets as well as the higher interest rate environment had a positive impact on interest income for the year ended December 31, 2024.
Net interest income and the net interest margin are affected by both changes in the level of interest rates and the amount and composition of interest-earning assets and interest-bearing liabilities. Growth in interest-earning assets as well as higher reinvestment rates for the investment and loan portfolios had a positive impact on interest income for the year ended December 31, 2025.
Changes in the volume of interest-earning assets and interest-bearing liabilities positively increased net interest income by $1.5 million in the year ended December 31, 2024 compared to the same period in 2023.
Changes in the volume of interest-earning assets and interest-bearing liabilities positively increased net interest income by $18.3 million in the year ended December 31, 2025 compared to the same period in 2024.
Provision for Credit Losses The provision for credit losses is determined based on management’s estimates of the appropriate level of the allowance for credit losses needed to provide for expected losses inherent in the loan and lease portfolio and on off-balance sheet commitments.
Provision for Credit Losses The provision for credit losses is determined based on management’s estimates of the appropriate level of the allowance for credit losses needed to provide for expected losses inherent in the loan and lease portfolio and off-balance sheet commitments. The provision for credit losses is an amount added to the allowance against which credit losses are charged.
The sensitivity of estimated prepayment speeds had the largest impact on the residential first lien loan pool. 32 Table of Contents Selected Financial Information The following table provides selected financial information for the periods ended December 31, 2024 2023 2022 2021 2020 (dollars in thousands, except share data) Interest income $ 600,463 $ 529,998 $ 329,953 $ 293,838 $ 301,209 Interest expense 221,571 144,322 17,732 15,297 32,938 Net interest income 378,892 385,676 312,221 278,541 268,271 Provision for credit losses 29,170 14,813 21,106 (1,376) 56,718 Net interest income after provision for credit losses 349,722 370,863 291,115 279,917 211,553 Net securities gains (losses) (5,446) (103) 2 16 70 Other income 104,677 96,712 98,706 106,741 94,406 Other expenses 270,745 269,917 229,638 213,857 215,826 Income before income taxes 178,208 197,555 160,185 172,817 90,203 Income tax provision 35,636 40,492 32,004 34,560 16,756 Net Income $ 142,572 $ 157,063 $ 128,181 $ 138,257 $ 73,447 Per Share Data—Basic Net Income $ 1.40 $ 1.55 $ 1.37 $ 1.45 $ 0.75 Dividends declared $ 0.515 $ 0.495 $ 0.475 $ 0.455 $ 0.440 Average shares outstanding 101,913,111 101,556,427 93,612,043 95,583,890 97,499,586 Per Share Data—Diluted Net Income $ 1.39 $ 1.54 $ 1.37 $ 1.44 $ 0.75 Average shares outstanding 102,205,497 101,822,201 93,887,447 95,840,285 97,758,965 At End of Period Total assets $ 11,584,936 $ 11,459,488 $ 9,805,666 $ 9,545,093 $ 9,068,104 Investment securities 1,584,216 1,490,866 1,250,237 1,595,529 1,205,294 Loans and leases, net of unearned income 8,983,754 8,968,761 7,642,143 6,839,230 6,761,183 Allowance for credit losses 118,906 117,718 102,906 92,522 101,309 Deposits 9,678,019 9,192,309 8,005,469 7,982,498 7,438,666 Short-term borrowings 80,139 597,835 372,694 138,315 117,373 Subordinated debentures 128,305 177,741 170,937 170,775 170,612 Other long-term debt 130,353 4,122 4,862 5,573 56,258 Shareholders’ equity 1,405,165 1,314,274 1,052,074 1,109,372 1,068,617 Key Ratios Return on average assets 1.22 % 1.42 % 1.34 % 1.47 % 0.82 % Return on average equity 10.44 12.80 11.99 12.55 6.82 Net loans to deposits ratio 91.60 96.29 94.18 84.52 89.53 Dividends per share as a percent of net income per share 36.79 31.94 34.67 31.38 58.67 Average equity to average assets ratio 11.72 11.06 11.16 11.72 12.00 Results of Operations—2024 Compared to 2023 Net Income Net income for 2024 was $142.6 million, or $1.39 per diluted share, as compared to net income of $157.1 million, or $1.54 per diluted share in 2023.
The sensitivity of estimated prepayment speeds had the largest impact on the residential first lien loan pool. 33 Table of Contents Selected Financial Information The following table provides selected financial information for the periods ended December 31, 2025 2024 2023 2022 2021 (dollars in thousands, except share data) Interest income $ 632,688 $ 600,463 $ 529,998 $ 329,953 $ 293,838 Interest expense 206,601 221,571 144,322 17,732 15,297 Net interest income 426,087 378,892 385,676 312,221 278,541 Provision for credit losses 36,725 29,170 14,813 21,106 (1,376) Net interest income after provision for credit losses 389,362 349,722 370,863 291,115 279,917 Net securities gains (losses) (4,348) (5,446) (103) 2 16 Other income 101,172 104,677 96,712 98,706 106,741 Other expenses 294,828 270,745 269,917 229,638 213,857 Income before income taxes 191,358 178,208 197,555 160,185 172,817 Income tax provision 39,056 35,636 40,492 32,004 34,560 Net Income $ 152,302 $ 142,572 $ 157,063 $ 128,181 $ 138,257 Per Share Data—Basic Net Income $ 1.48 $ 1.40 $ 1.55 $ 1.37 $ 1.45 Dividends declared $ 0.535 $ 0.515 $ 0.495 $ 0.475 $ 0.455 Average shares outstanding 103,220,081 101,913,111 101,556,427 93,612,043 95,583,890 Per Share Data—Diluted Net Income $ 1.47 $ 1.39 $ 1.54 $ 1.37 $ 1.44 Average shares outstanding 103,524,130 102,205,497 101,822,201 93,887,447 95,840,285 At End of Period Total assets $ 12,343,036 $ 11,584,936 $ 11,459,488 $ 9,805,666 $ 9,545,093 Investment securities 1,571,911 1,584,216 1,490,866 1,250,237 1,595,529 Loans and leases, net of unearned income 9,508,039 8,983,754 8,968,761 7,642,143 6,839,230 Allowance for credit losses 125,768 118,906 117,718 102,906 92,522 Deposits 10,250,969 9,678,019 9,192,309 8,005,469 7,982,498 Short-term borrowings 147,966 80,139 597,835 372,694 138,315 Subordinated debentures 128,466 128,305 177,741 170,937 170,775 Other long-term debt 129,555 130,353 4,122 4,862 5,573 Shareholders’ equity 1,554,376 1,405,165 1,314,274 1,052,074 1,109,372 Key Ratios Return on average assets 1.26 % 1.22 % 1.42 % 1.34 % 1.47 % Return on average equity 10.15 10.44 12.80 11.99 12.55 Net loans to deposits ratio 91.53 91.60 96.29 94.18 84.52 Dividends per share as a percent of net income per share 36.15 36.79 31.94 34.67 31.38 Average equity to average assets ratio 12.45 11.72 11.06 11.16 11.72 Results of Operations—2025 Compared to 2024 Net Income Net income for 2025 was $152.3 million, or $1.47 per diluted share, as compared to net income of $142.6 million, or $1.39 per diluted share in 2024.
Gross unrealized gains were $5.4 million and gross unrealized losses were $125.6 million. The level of gross unrealized losses is directly related to the increase in market interest rates.
Gross unrealized gains were $5.7 million and gross unrealized losses were $87.7 million. The level of gross unrealized losses is directly related to the increase in market interest rates.
As of December 31, 2024, a reserve for expected credit losses of $4.1 million was recorded for unused commitments and letters of credit. 49 Table of Contents Liquidity Liquidity refers to our ability to meet the cash flow requirements of depositors and borrowers, as well as our operating cash needs, with cost-effective funding.
As of December 31, 2025, a reserve for expected credit losses of $8.2 million was recorded for unused commitments and letters of credit. Liquidity Liquidity refers to our ability to meet the cash flow requirements of depositors and borrowers, as well as our operating cash needs, with cost-effective funding.
Additionally, for the year ended December 31, 2024 seven basis points of the yield on interest-earning assets can be attributed to the recognition of $7.5 million in accretion of purchase accounting marks, primarily from the Centric acquisition.
Additionally, for the year ended December 31, 2025, seven basis points of the yield on interest-earning assets can be attributed to the recognition of $7.4 million in accretion of purchase accounting marks, primarily from the Centric and Center acquisitions.
The following is a comparison of nonperforming assets and the effects on interest due to nonaccrual loans for the period ended December 31: 2024 2023 2022 2021 2020 (dollars in thousands) Nonperforming Loans: Loans on nonaccrual basis $ 61,456 $ 39,472 $ 20,193 $ 34,926 $ 30,801 Loans held for sale on nonaccrual basis — — — — 13 Troubled debt restructured loans on nonaccrual basis — — 8,852 13,134 14,740 Troubled debt restructured loans on accrual basis — — 6,442 7,120 8,512 Total nonperforming loans $ 61,456 $ 39,472 $ 35,487 $ 55,180 $ 54,066 Loans and leases past due in excess of 90 days and still accruing $ 2,064 $ 9,436 $ 1,991 $ 1,606 $ 1,523 Other real estate owned $ 895 $ 422 $ 534 $ 642 $ 1,215 Loans and leases outstanding at end of period $ 8,983,754 $ 8,968,761 $ 7,642,143 $ 6,839,230 $ 6,761,183 Average loans and leases outstanding $ 9,013,742 $ 8,714,770 $ 7,172,624 $ 6,777,192 $ 6,737,339 Nonperforming loans as a percentage of total loans and leases 0.68 % 0.44 % 0.46 % 0.81 % 0.80 % Provision for credit losses on loans and leases $ 32,368 $ 7,106 $ 17,521 (377) 53,472 Provision for credit losses - acquisition day 1 non-PCD $ — $ 10,653 $ — $ — $ — Allowance for credit losses $ 118,906 $ 117,718 $ 102,906 $ 92,522 $ 101,309 Net charge-offs $ 31,180 $ 30,152 $ 7,137 $ 8,410 $ 17,193 Net charge-offs as a percentage of average loans and leases outstanding 0.35 % 0.35 % 0.10 % 0.12 % 0.26 % Provision for credit losses on loans and leases as a percentage of net charge-offs (b) 103.81 % 23.57 % 245.50 % (4.48) % 311.01 % Allowance for credit losses as a percentage of end-of-period loans and leases outstanding (a) 1.32 % 1.31 % 1.35 % 1.35 % 1.50 % Allowance for credit losses as a percentage of nonperforming loans (a) 193.48 % 298.23 % 289.98 % 167.67 % 187.43 % Gross income that would have been recorded at original rates $ 6,717 $ 3,894 $ 1,444 $ 3,503 $ 3,733 Interest that was reflected in income 705 530 244 569 297 Net reduction to interest income due to nonaccrual $ 6,012 $ 3,364 $ 1,200 $ 2,934 $ 3,436 (a) End of period loans and nonperforming loans exclude loans held for sale.
The following is a comparison of nonperforming assets and the effects on interest due to nonaccrual loans for the period ended December 31: 2025 2024 2023 2022 2021 (dollars in thousands) Nonperforming Loans: Loans on nonaccrual basis $ 91,756 $ 61,456 $ 39,472 $ 20,193 $ 34,926 Troubled debt restructured loans on nonaccrual basis — — — 8,852 13,134 Troubled debt restructured loans on accrual basis — — — 6,442 7,120 Total nonperforming loans $ 91,756 $ 61,456 $ 39,472 $ 35,487 $ 55,180 Loans and leases past due in excess of 90 days and still accruing $ 1,288 $ 2,064 $ 9,436 $ 1,991 $ 1,606 Other real estate owned $ 990 $ 895 $ 422 $ 534 $ 642 Loans and leases outstanding at end of period $ 9,508,039 $ 8,983,754 $ 8,968,761 $ 7,642,143 $ 6,839,230 Average loans and leases outstanding $ 9,474,491 $ 9,013,742 $ 8,714,770 $ 7,172,624 $ 6,777,192 Nonperforming loans as a percentage of total loans and leases 0.97 % 0.68 % 0.44 % 0.46 % 0.81 % Provision for credit losses on loans and leases $ 29,298 $ 32,368 $ 7,106 $ 17,521 $ (377) Provision for credit losses - acquisition day 1 non-PCD $ 3,759 $ — $ 10,653 $ — $ — Allowance for credit losses $ 125,768 $ 118,906 $ 117,718 $ 102,906 $ 92,522 Net charge-offs $ 29,375 $ 31,180 $ 30,152 $ 7,137 $ 8,410 Net charge-offs as a percentage of average loans and leases outstanding 0.31 % 0.35 % 0.35 % 0.10 % 0.12 % Provision for credit losses on loans and leases as a percentage of net charge-offs (b) 99.74 % 103.81 % 23.57 % 245.50 % (4.48) % Allowance for credit losses as a percentage of end-of-period loans and leases outstanding (a) 1.32 % 1.32 % 1.31 % 1.35 % 1.35 % Allowance for credit losses as a percentage of nonperforming loans (a) 137.07 % 193.48 % 298.23 % 289.98 % 167.67 % Gross income that would have been recorded at original rates $ 6,814 $ 6,717 $ 3,894 $ 1,444 $ 3,503 Interest that was reflected in income 1,080 705 530 244 569 Net reduction to interest income due to nonaccrual $ 5,734 $ 6,012 $ 3,364 $ 1,200 $ 2,934 (a) End of period loans and nonperforming loans exclude loans held for sale.
Credit measures as of December 31, 2024 compared to December 31, 2023 reflect an increase in the level of criticized loans of $14.0 million, from $210.2 million at December 31, 2023 to $224.2 million at December 31, 2024.
Credit measures as of December 31, 2025 as compared to December 31, 2024 reflect an increase in the level of criticized loans of $43.0 million, from $224.2 million at December 31, 2024 to $267.2 million at December 31, 2025.
The average loan commitment size for the office portfolio is $1.6 million and the average outstanding balance as of December 31, 2024 is $1.1 million. Within the office portfolio, exposures over $1.0 million have an average debt service coverage ratio of 1.46x, which exceeds our internal guidelines of 1.35x to 1.40x, depending on property class.
The average loan commitment size for the office portfolio is $0.9 million and the average outstanding balance as of December 31, 2025 is $0.9 million. Within the office portfolio, exposures over $1.0 million have an average debt service coverage ratio of 1.54x, which exceeds our internal guidelines of 1.25x to 1.50x, depending on property class.
Swap fee income declined $0.6 million as a result of a decrease in new interest rate swaps entered into by our commercial loan customers compared to the prior period. Total noninterest income increased $2.6 million, or 3%, in comparison to the year ended December 31, 2023.
Swap fee income increased $0.7 million, compared to the prior period, as a result of a growth in new interest rate swaps entered into by our commercial loan customers. Total noninterest income decreased $2.4 million, or 2%, in comparison to the year ended December 31, 2024.
The allowance for credit losses includes specific allocations of $8.0 million related to nonperforming loans covering 13% of the total nonperforming balance at December 31, 2024 and specific allocations of $4.5 million covering 12% of the total nonperforming balance at December 31, 2023.
The allowance for credit losses includes specific allocations of $9.8 million related to nonperforming loans covering 11% of the total nonperforming balance at December 31, 2025 and specific allocations of $8.0 million covering 13% of the total nonperforming balance at December 31, 2024.
Proceeds from the sale, maturity and redemption of investment securities totaled $370.5 million during 2024 and provided liquidity to fund loans, purchase investment securities and fund depositor withdrawals.
Proceeds from the sale, maturity and redemption of investment securities totaled $429.4 million during 2025 and provided liquidity to fund loans, purchase investment securities and fund depositor withdrawals.
The allowance for credit losses was $118.9 million at December 31, 2024 or 1.32% of loans outstanding, compared to $117.7 million, or 1.31% of loans outstanding, at December 31, 2023.
The allowance for credit losses was $125.8 million at December 31, 2025, or 1.32% of loans outstanding, compared to $118.9 million, or 1.32% of loans outstanding, at December 31, 2024.
Loan and Lease Portfolio Following is a summary of our loan and lease portfolio as of December 31: 2024 2023 2022 2021 2020 Amount % Amount % Amount % Amount % Amount % (dollars in thousands) Commercial, financial, agricultural and other $ 1,677,989 19 % $ 1,543,349 17 % $ 1,211,706 16 % $ 1,173,452 17 % $ 1,555,986 23 % Real estate construction 483,384 5 597,735 7 513,101 7 494,456 7 427,221 6 Residential real estate 2,341,703 26 2,416,876 27 2,194,669 29 1,920,250 28 1,750,592 26 Commercial real estate 3,124,704 35 3,053,152 34 2,425,012 31 2,251,097 33 2,211,569 33 Loans to individuals 1,355,974 15 1,357,649 15 1,297,655 17 999,975 15 815,815 12 Total loans and leases $ 8,983,754 100 % $ 8,968,761 100 % $ 7,642,143 100 % $ 6,839,230 100 % $ 6,761,183 100 % The loan and lease portfolio totaled $9.0 billion as of December 31, 2024, reflecting growth of $15.0 million compared to December 31, 2023.
Loan and Lease Portfolio Following is a summary of our loan and lease portfolio as of December 31: 2025 2024 2023 2022 2021 Amount % Amount % Amount % Amount % Amount % (dollars in thousands) Commercial, financial, agricultural and other $ 2,044,989 22 % $ 1,677,989 19 % $ 1,543,349 17 % $ 1,211,706 16 % $ 1,173,452 17 % Real estate construction 462,786 5 483,384 5 597,735 7 513,101 7 494,456 7 Residential real estate 2,360,285 25 2,341,703 26 2,416,876 27 2,194,669 29 1,920,250 28 Commercial real estate 3,182,109 33 3,124,704 35 3,053,152 34 2,425,012 31 2,251,097 33 Loans to individuals 1,457,870 15 1,355,974 15 1,357,649 15 1,297,655 17 999,975 15 Total loans and leases $ 9,508,039 100 % $ 8,983,754 100 % $ 8,968,761 100 % $ 7,642,143 100 % $ 6,839,230 100 % The loan and lease portfolio, excluding loans held for sale, totaled $9.5 billion as of December 31, 2025, reflecting growth of $524.3 million compared to December 31, 2024.
Government-sponsored enterprises, have contractual maturities ranging from less than one year to approximately 41 years and have anticipated average lives to maturity ranging from less than three years to approximately six years. The available for sale investment portfolio amortized cost increased $129.3 million, or 11%, at December 31, 2024 compared to 2023.
Government-sponsored enterprises, have contractual maturities ranging from less than one year to approximately 42 years and have anticipated average lives to maturity ranging from less than three years to approximately six years. The available for sale investment portfolio amortized cost decreased $171.5 million, or 14%, at December 31, 2025 compared to 2024.
Nonperforming loans as a percentage of total loans increased to 0.68% at December 31, 2024 from 0.44% at December 31, 2023. The allowance to nonperforming loan ratio was 193.5% as of December 31, 2024 and 298.2% at December 31, 2023.
Nonperforming loans as a percentage of total loans increased to 0.97% at December 31, 2025 from 0.68% at December 31, 2024. The allowance to nonperforming loan ratio was 137.1% as of December 31, 2025 and 193.5% at December 31, 2024.
This change was primarily driven by the $31.2 million in net charge-offs.
This change was primarily driven by the $29.4 million in net charge-offs.
Uninsured amounts are estimated based on known deposit account relationships for each depositor and insurance guidelines provided by the FDIC. Short-Term Borrowings and Long-Term Debt Short-term borrowings decreased $517.7 million, or 87%, from $597.8 million at December 31, 2023 to $80.1 million at December 31, 2024.
Uninsured amounts are estimated based on known deposit account relationships for each depositor and insurance guidelines provided by the FDIC. Short-Term Borrowings and Long-Term Debt Short-term borrowings increased $67.8 million, or 85%, from $80.1 million at December 31, 2024 to $148.0 million at December 31, 2025.
Maximum capacity with CDARs is $1.7 billion. Our participation in the Certificate of Deposit Account Registry Services ("CDARS") program is part of an ALCO strategy to increase and diversify funding sources. As of December 31, 2024, the outstanding CDARS balance of $14.5 million carried an average weighted rate of 3.22% and an average original term of 357 days.
Maximum capacity with CDARs is $1.8 billion. Our participation in the Certificate of Deposit Account Registry Services ("CDARS") program is part of an ALCO strategy to increase and diversify funding sources. As of December 31, 2025, the outstanding CDARS balance of $15.0 million carried an average weighted rate of 2.93% and an average original term of 322 days.
Most of the growth in this portfolio was in the Mortgage-Backed Securities - Commercial category as these securities provide ongoing liquidity through regular principal paydowns and additionally can be pledged for borrowings or to secure public deposits. The following is a schedule of the contractual maturity distribution of securities available for sale at December 31, 2024. U.S.
These securities provide ongoing liquidity through regular principal paydowns and additionally can be pledged for borrowings or to secure public deposits. The following is a schedule of the contractual maturity distribution of securities available for sale at December 31, 2025. U.S.
(b) Does not include provision for credit losses on loans and leases - acquisition day 1 non-PCD. 45 Table of Contents Nonperforming loans increased $22.0 million to $61.5 million at December 31, 2024, compared to $39.5 million at December 31, 2023.
(b) Does not include provision for credit losses on loans and leases - acquisition day 1 non-PCD. 46 Table of Contents Nonperforming loans increased $30.3 million to $91.8 million at December 31, 2025, compared to $61.5 million at December 31, 2024.
Comparing December 31, 2024 to December 31, 2023, the general reserve for performing loans is 1.24% and 1.26%, respectively, of total performing loans for both periods. Reserves for individually analyzed loans increased from 11.5% of nonperforming loans at December 31, 2023 to 13.0% of nonperforming loans at December 31, 2024.
Comparing December 31, 2025 to December 31, 2024, the general reserve for performing loans is 1.22% and 1.24%, respectively, of total performing loans for both periods. Reserves for individually analyzed loans decreased from 13.0% of nonperforming loans at December 31, 2024 to 10.7% of nonperforming loans at December 31, 2025.
Government-Sponsored Enterprises: Mortgage-Backed Securities—Residential 266,587 296,432 329,267 Mortgage-Backed Securities—Commercial — 2,190 4,794 Other Government-Sponsored Enterprises 22,869 22,543 22,221 Obligations of States and Political Subdivisions 24,193 25,561 26,643 Debt Securities Issued by Foreign Governments 1,000 1,000 1,000 Total Securities Held to Maturity $ 405,639 $ 419,009 $ 461,162 The following is a schedule of the contractual maturity distribution of securities held to maturity at December 31, 2024.
Government-Sponsored Enterprises: Mortgage-Backed Securities—Residential 307,676 266,587 296,432 Mortgage-Backed Securities—Commercial — — 2,190 Other Government-Sponsored Enterprises 23,199 22,869 22,543 Obligations of States and Political Subdivisions 22,743 24,193 25,561 Debt Securities Issued by Foreign Governments 800 1,000 1,000 Total Securities Held to Maturity $ 519,422 $ 405,639 $ 419,009 The following is a schedule of the contractual maturity distribution of securities held to maturity at December 31, 2025.
Gain on sale of mortgages increased $1.8 million as a result of changes in volume and spread received on mortgage loans sold, and gain on sale of other loans and assets increased $2.4 million due to an increase in the volume and spread on the sale of SBA loans.
Gain on sale of mortgages increased $1.5 million as a result of changes in volume and spread received on mortgage loans sold, and gain on sale of other loans and assets decreased $2.2 million as a result of a decline in the volume and spread on the sale of SBA loans.
Liquidity available through the Federal Reserve is a result of the FRB Borrower-in-Custody of Collateral program, which enables us to take certain loans that are not being used as collateral at the FHLB and pledge them as collateral for borrowings at the FRB.
Liquidity available through the Federal Reserve is a result of the FRB Borrower-in-Custody of Collateral program, which enables us to take certain loans that are not being used as collateral at the FHLB and pledge them as collateral for borrowings at the FRB. Refer to “Financial Condition” above for additional information concerning our deposits, loan portfolio, investment securities and borrowings.
Management believes that the allowance for credit losses is at a level deemed appropriate to absorb expected losses inherent in the loan portfolio at December 31, 2024. 38 Table of Contents A detailed analysis of our credit loss experience for the previous five years is shown below: 2024 2023 2022 2021 2020 (dollars in thousands) Loans and leases outstanding at end of year $ 8,983,754 $ 8,968,761 $ 7,642,143 $ 6,839,230 $ 6,761,183 Average loans outstanding $ 9,013,742 $ 8,714,770 $ 7,172,624 $ 6,777,192 $ 6,737,339 Balance, beginning of year $ 117,718 $ 102,906 $ 92,522 $ 101,309 $ 51,637 Day 1 allowance for credit loss on PCD acquired loans — 27,205 — — — Provision for credit losses - acquisition day 1 non-PCD — 10,653 — — — Adoption of accounting standard - ASU 2016-13 — — — — 13,393 Loans charged off: Commercial, financial, agricultural and other 15,512 19,199 2,361 7,020 6,318 Real estate construction 1,092 — — 9 — Residential real estate 483 561 339 309 1,040 Commercial real estate 8,678 6,277 2,487 1,659 4,939 Loans to individuals 9,663 7,230 4,658 4,061 6,953 Total loans charged off 35,428 33,267 9,845 13,058 19,250 Recoveries of loans previously charged off: Commercial, financial, agricultural and other 813 498 394 2,430 314 Real estate construction 6 — 9 155 26 Residential real estate 370 247 187 468 414 Commercial real estate 177 151 769 135 312 Loans to individuals 2,882 2,219 1,349 1,460 991 Total recoveries 4,248 3,115 2,708 4,648 2,057 Net charge-offs 31,180 30,152 7,137 8,410 17,193 Provision charged to expense 32,368 7,106 17,521 (377) 53,472 Balance, end of year $ 118,906 $ 117,718 $ 102,906 $ 92,522 $ 101,309 Ratios: Net charge-offs as a percentage of average loans and leases outstanding 0.35 % 0.35 % 0.10 % 0.12 % 0.26 % Allowance for credit losses as a percentage of end-of-period loans and leases outstanding 1.32 % 1.31 % 1.35 % 1.35 % 1.50 % 39 Table of Contents Noninterest Income The components of noninterest income for each year in the three-year period ended December 31 are as follows: 2024 compared to 2023 2024 2023 2022 $ Change % Change (dollars in thousands) Noninterest Income: Trust income $ 11,821 $ 10,516 $ 10,518 $ 1,305 12 % Service charges on deposit accounts 22,518 21,437 19,641 1,081 5 Insurance and retail brokerage commissions 11,546 10,929 9,968 617 6 Income from bank owned life insurance 6,361 4,875 5,459 1,486 30 Card-related interchange income 21,887 28,640 27,603 (6,753) (24) Swap fee income 885 1,519 4,685 (634) (42) Other income 9,135 8,087 9,152 1,048 13 Subtotal 84,153 86,003 87,026 (1,850) (2) Net securities (losses) gains (5,446) (103) 2 (5,343) 5,187 Gain on VISA exchange 5,664 — — 5,664 100 Gain on sale of mortgage loans 5,795 3,951 5,276 1,844 47 Gain on sale of other loans and assets 9,111 6,744 6,036 2,367 35 Derivative mark to market (46) 14 368 (60) (429) Total noninterest income $ 99,231 $ 96,609 $ 98,708 $ 2,622 3 % Noninterest income, excluding net securities (losses) gains, gain on VISA exchange, gain on sale of mortgage loans, gain on sale of other loans and assets and the derivatives mark to market, decreased $1.9 million, or 2%, in 2024.
Management believes that the allowance for credit losses is at a level deemed appropriate to absorb expected losses inherent in the loan portfolio at December 31, 2025. 39 Table of Contents A detailed analysis of our credit loss experience for the previous five years is shown below: 2025 2024 2023 2022 2021 (dollars in thousands) Loans and leases outstanding at end of year $ 9,508,039 $ 8,983,754 $ 8,968,761 $ 7,642,143 $ 6,839,230 Average loans outstanding $ 9,474,491 $ 9,013,742 $ 8,714,770 $ 7,172,624 $ 6,777,192 Balance, beginning of year $ 118,906 $ 117,718 $ 102,906 $ 92,522 $ 101,309 Day 1 allowance for credit loss on PCD acquired loans 3,560 — 27,205 — — Provision for credit losses - acquisition day 1 non-PCD 3,379 — 10,653 — — Loans charged off: Commercial, financial, agricultural and other 20,252 15,512 19,199 2,361 7,020 Real estate construction 1,294 1,092 — — 9 Residential real estate 745 483 561 339 309 Commercial real estate 7,188 8,678 6,277 2,487 1,659 Loans to individuals 8,887 9,663 7,230 4,658 4,061 Total loans charged off 38,366 35,428 33,267 9,845 13,058 Recoveries of loans previously charged off: Commercial, financial, agricultural and other 5,118 813 498 394 2,430 Real estate construction — 6 — 9 155 Residential real estate 234 370 247 187 468 Commercial real estate 217 177 151 769 135 Loans to individuals 3,422 2,882 2,219 1,349 1,460 Total recoveries 8,991 4,248 3,115 2,708 4,648 Net charge-offs 29,375 31,180 30,152 7,137 8,410 Provision charged to expense 29,298 32,368 7,106 17,521 (377) Balance, end of year $ 125,768 $ 118,906 $ 117,718 $ 102,906 $ 92,522 Ratios: Net charge-offs as a percentage of average loans and leases outstanding 0.31 % 0.35 % 0.35 % 0.10 % 0.12 % Allowance for credit losses as a percentage of end-of-period loans and leases outstanding 1.32 % 1.32 % 1.31 % 1.35 % 1.35 % 40 Table of Contents Noninterest Income The components of noninterest income for each year in the three-year period ended December 31 are as follows: 2025 compared to 2024 2025 2024 2023 $ Change % Change (dollars in thousands) Noninterest Income: Trust income $ 12,907 $ 11,821 $ 10,516 $ 1,086 9 % Service charges on deposit accounts 22,774 22,518 21,437 256 1 Insurance and retail brokerage commissions 12,652 11,546 10,929 1,106 10 Income from bank owned life insurance 6,877 6,361 4,875 516 8 Card-related interchange income 15,611 21,887 28,640 (6,276) (29) Swap fee income 1,543 885 1,519 658 74 Other income 9,604 9,135 8,087 469 5 Subtotal 81,968 84,153 86,003 (2,185) (3) Net securities losses (4,348) (5,446) (103) 1,098 (20) Gain on VISA exchange 5,146 5,664 — (518) (9) Gain on sale of mortgage loans 7,296 5,795 3,951 1,501 26 Gain on sale of other loans and assets 6,888 9,111 6,744 (2,223) (24) Derivative mark to market (126) (46) 14 (80) 174 Total noninterest income $ 96,824 $ 99,231 $ 96,609 $ (2,407) (2) % Total noninterest income (excluding net securities losses, gain on VISA exchange, gain on sale of mortgage loans, gain on sale of other loans and assets and the derivatives mark to market), decreased $2.2 million, or 3%, in 2025.
Net interest income change (12 months) for basis point movements of: -200 -100 +100 +200 (dollars in thousands) December 31, 2024 ($) $ (8,351) $ (4,213) $ 5,101 $ 9,080 December 31, 2024 (%) (2.07) % (1.05) % 1.27 % 2.25 % December 31, 2023 ($) $ (9,867) $ (4,504) $ 6,215 $ 11,091 December 31, 2023 (%) (2.53) % (1.16) % 1.59 % 2.84 % The following table represents the potential sensitivity of our annual net interest income to immediate changes in interest rates versus if rates remained unchanged and there are no changes in balance sheet categories.
Net interest income change (12 months) for basis point movements of: -200 -100 +100 +200 (dollars in thousands) December 31, 2025 ($) $ (1,761) $ (979) $ 4,114 $ 8,173 December 31, 2025 (%) (0.40) % (0.22) % 0.95 % 1.88 % December 31, 2024 ($) $ (8,351) $ (4,213) $ 5,101 $ 9,080 December 31, 2024 (%) (2.07) % (1.05) % 1.27 % 2.25 % The following table represents the potential sensitivity of our annual net interest income to immediate changes in interest rates versus if rates remained unchanged and there are no changes in balance sheet categories.
Government Agencies: Mortgage-Backed Securities—Residential $ 1,586 $ 1,781 $ 2,008 Mortgage-Backed Securities—Commercial 89,404 69,502 75,229 Obligations of U.S.
Government Agencies: Mortgage-Backed Securities—Residential $ 1,379 $ 1,586 $ 1,781 Mortgage-Backed Securities—Commercial 163,625 89,404 69,502 Obligations of U.S.
Government-Sponsored Enterprises: Mortgage-Backed Securities—Residential 413,434 559,769 527,777 Other Government-Sponsored Enterprises 1,000 1,000 1,000 Obligations of States and Political Subdivisions 8,510 9,226 9,482 Corporate Securities 62,475 51,886 32,010 Total Securities Available for Sale $ 1,267,747 $ 1,138,425 $ 898,702 As of December 31, 2024, securities available for sale had a fair value of $1.1 billion.
Government-Sponsored Enterprises: Mortgage-Backed Securities—Residential 336,493 413,434 559,769 Other Government-Sponsored Enterprises 1,000 1,000 1,000 Obligations of States and Political Subdivisions 7,560 8,510 9,226 Corporate Securities 46,969 62,475 51,886 Total Securities Available for Sale $ 1,096,232 $ 1,267,747 $ 1,138,425 As of December 31, 2025, securities available for sale had a fair value of $1.0 billion.
Time deposits of $250 thousand or more had remaining maturities as follows as of the end of each year in the two-year period ended December 31: 2024 2023 Amount % Amount % (dollars in thousands) 3 months or less $ 215,806 47 % $ 70,122 24 % Over 3 months through 6 months 101,101 22 62,981 22 Over 6 months through 12 months 125,863 27 107,144 37 Over 12 months 17,081 4 48,508 17 Total $ 459,851 100 % $ 288,755 100 % The estimated total amount of uninsured deposits was $2.6 billion and $2.5 billion at December 31, 2024 and 2023, respectively, of which $0.7 billion were secured by pledged investment securities or letters of credit at December 31, 2024 and 2023.
Time deposits of $250 thousand or more had remaining maturities as follows as of the end of each year in the two-year period ended December 31: 2025 2024 Amount % Amount % (dollars in thousands) 3 months or less $ 210,514 49 % $ 215,806 47 % Over 3 months through 6 months 142,435 33 101,101 22 Over 6 months through 12 months 74,259 17 125,863 27 Over 12 months 5,209 1 17,081 4 Total $ 432,417 100 % $ 459,851 100 % The estimated total amount of uninsured deposits was $2.9 billion and $2.6 billion at December 31, 2025 and 2024, respectively, of which $0.8 billion and $0.7 billion were secured by pledged investment securities or letters of credit at December 31, 2025 and 2024, respectively.
Loans with variable or adjustable interest rates include approximately 27% tied to the prime interest rate, 50% tied to SOFR, 11% tied to Treasury rates, 10% tied to Federal Home Loan Bank rates.
Loans with variable or adjustable interest rates include approximately 26% tied to the prime interest rate, 51% tied to SOFR, 12% tied to Treasury rates and 9% tied to Federal Home Loan Bank rates.
Purchases of available for sale investments totaled $437.3 million during 2024 and calls or maturities totaled $302.5 million. The level of purchases were impacted by liquidity available from increased deposits.
Purchases of available for sale investments totaled $162.1 million during 2025 and calls or maturities totaled $282.7 million. The level of purchases were impacted by liquidity available from increased deposits.
Income Tax The provision for income taxes of $35.6 million in 2024 reflects a decrease of $4.9 million compared to the provision for income taxes in 2023 as a result of a $19.3 million decrease in the level of income before taxes. The effective tax rate was 20.0% and 20.5% for tax expense in 2024 and 2023, respectively.
Income Tax The provision for income taxes of $39.1 million in 2025 reflects an increase of $3.4 million compared to the provision for income taxes in 2024 as a result of a $13.2 million increase in the level of income before taxes. The effective tax rate was 20.4% and 20.0% for tax expense in 2025 and 2024, respectively.
The following table reconciles interest income in the Consolidated Statements of Income to net interest income adjusted to a fully taxable equivalent basis for the periods presented: For the Years Ended December 31, 2024 2023 2022 (dollars in thousands) Interest income per Consolidated Statements of Income $ 600,463 $ 529,998 $ 329,953 Adjustment to fully taxable equivalent basis 1,347 1,237 1,049 Interest income adjusted to fully taxable equivalent basis (non-GAAP) 601,810 531,235 331,002 Interest expense 221,571 144,322 17,732 Net interest income adjusted to fully taxable equivalent basis (non-GAAP) $ 380,239 $ 386,913 $ 313,270 35 Table of Contents The following table provides information regarding the average balances and yields or rates on interest-earning assets and interest-bearing liabilities for the periods ended December 31: Average Balance Sheets and Net Interest Analysis 2024 2023 2022 Average Balance Income / Expense (a) Yield or Rate Average Balance Income / Expense (a) Yield or Rate Average Balance Income / Expense (a) Yield or Rate (dollars in thousands) Assets Interest-earning assets: Interest-bearing deposits with banks $ 164,339 $ 9,071 5.52 % $ 176,146 $ 9,491 5.39 % $ 188,370 $ 1,722 0.91 % Tax-free investment securities 19,965 530 2.65 21,485 578 2.69 23,060 606 2.63 Taxable investment securities 1,516,847 49,688 3.28 1,239,369 29,340 2.37 1,355,836 25,545 1.88 Loans and leases, net of unearned income (b)(c)(e) 9,013,742 542,521 6.02 8,714,770 491,826 5.64 7,172,624 303,129 4.23 Total interest-earning assets 10,714,893 601,810 5.62 10,151,770 531,235 5.23 8,739,890 331,002 3.79 Noninterest-earning assets: Cash 111,997 112,157 111,554 Allowance for credit losses (122,867) (132,046) (94,912) Other assets 950,943 959,972 818,701 Total noninterest-earning assets 940,073 940,083 835,343 Total Assets $ 11,654,966 $ 11,091,853 $ 9,575,233 Liabilities and Shareholders’ Equity Interest-bearing liabilities: Interest-bearing demand deposits (d) $ 1,907,627 $ 34,155 1.79 % $ 1,959,595 $ 25,652 1.31 % $ 1,596,197 $ 1,376 0.09 % Savings deposits (d) 3,728,926 89,852 2.41 3,548,587 54,847 1.55 3,374,638 4,145 0.12 Time deposits 1,549,999 67,025 4.32 972,735 31,907 3.28 352,622 1,193 0.34 Short-term borrowings 444,453 20,439 4.60 439,556 21,747 4.95 144,834 1,999 1.38 Long-term debt 186,550 10,100 5.41 186,687 10,169 5.45 181,724 9,019 4.96 Total interest-bearing liabilities 7,817,555 221,571 2.83 7,107,160 144,322 2.03 5,650,015 17,732 0.31 Noninterest-bearing liabilities and shareholders’ equity: Noninterest-bearing demand deposits (d) 2,298,065 2,552,596 2,708,580 Other liabilities 173,426 205,224 147,871 Shareholders’ equity 1,365,920 1,226,873 1,068,767 Total noninterest-bearing funding sources 3,837,411 3,984,693 3,925,218 Total Liabilities and Shareholders’ Equity $ 11,654,966 $ 11,091,853 $ 9,575,233 Net Interest Income and Net Yield on Interest-Earning Assets $ 380,239 3.55 % $ 386,913 3.81 % $ 313,270 3.58 % (a) Income on interest-earning assets has been computed on a fully taxable equivalent basis using the federal income tax statutory rate of 21%.
The following table reconciles interest income in the Consolidated Statements of Income to net interest income adjusted to a fully taxable equivalent basis for the periods presented: For the Years Ended December 31, 2025 2024 2023 (dollars in thousands) Interest income per Consolidated Statements of Income $ 632,688 $ 600,463 $ 529,998 Adjustment to fully taxable equivalent basis 1,382 1,347 1,237 Interest income adjusted to fully taxable equivalent basis (non-GAAP) 634,070 601,810 531,235 Interest expense 206,601 221,571 144,322 Net interest income adjusted to fully taxable equivalent basis (non-GAAP) $ 427,469 $ 380,239 $ 386,913 36 Table of Contents The following table provides information regarding the average balances and yields or rates on interest-earning assets and interest-bearing liabilities for the periods ended December 31: Average Balance Sheets and Net Interest Analysis 2025 2024 2023 Average Balance Income / Expense (a) Yield or Rate Average Balance Income / Expense (a) Yield or Rate Average Balance Income / Expense (a) Yield or Rate (dollars in thousands) Assets Interest-earning assets: Interest-bearing deposits with banks $ 56,166 $ 2,654 4.73 % $ 164,339 $ 9,071 5.52 % $ 176,146 $ 9,491 5.39 % Tax-free investment securities 17,680 460 2.60 19,965 530 2.65 21,485 578 2.69 Taxable investment securities 1,579,540 56,958 3.61 1,516,847 49,688 3.28 1,239,369 29,340 2.37 Loans and leases, net of unearned income (b)(c)(d) 9,474,491 573,998 6.06 9,013,742 542,521 6.02 8,714,770 491,826 5.64 Total interest-earning assets 11,127,877 634,070 5.70 10,714,893 601,810 5.62 10,151,770 531,235 5.23 Noninterest-earning assets: Cash 106,569 111,997 112,157 Allowance for credit losses (128,990) (122,867) (132,046) Other assets 950,699 950,943 959,972 Total noninterest-earning assets 928,278 940,073 940,083 Total Assets $ 12,056,155 $ 11,654,966 $ 11,091,853 Liabilities and Shareholders’ Equity Interest-bearing liabilities: Interest-bearing demand deposits $ 1,897,654 $ 28,077 1.48 % $ 1,907,627 $ 34,155 1.79 % $ 1,959,595 $ 25,652 1.31 % Savings deposits 4,075,057 95,050 2.33 3,728,926 89,852 2.41 3,548,587 54,847 1.55 Time deposits 1,763,299 66,945 3.80 1,549,999 67,025 4.32 972,735 31,907 3.28 Short-term borrowings 95,322 3,494 3.67 444,453 20,439 4.60 439,556 21,747 4.95 Long-term debt 262,371 13,035 4.97 186,550 10,100 5.41 186,687 10,169 5.45 Total interest-bearing liabilities 8,093,703 206,601 2.55 7,817,555 221,571 2.83 7,107,160 144,322 2.03 Noninterest-bearing liabilities and shareholders’ equity: Noninterest-bearing demand deposits 2,328,689 2,298,065 2,552,596 Other liabilities 132,792 173,426 205,224 Shareholders’ equity 1,500,971 1,365,920 1,226,873 Total noninterest-bearing funding sources 3,962,452 3,837,411 3,984,693 Total Liabilities and Shareholders’ Equity $ 12,056,155 $ 11,654,966 $ 11,091,853 Net Interest Income and Net Yield on Interest-Earning Assets $ 427,469 3.84 % $ 380,239 3.55 % $ 386,913 3.81 % (a) Income on interest-earning assets has been computed on a fully taxable equivalent basis using the federal income tax statutory rate of 21%.
Contributing to the decrease in net income was a $6.8 million decline in net interest income and a $14.4 million increase in provision for credit losses. Provision for credit losses in 2023 included $10.7 million related to the day 1 adjustment on non-PCD loans acquired in the Centric acquisition.
Contributing to the increase in net income was a $47.2 million increase in net interest income, offset by a $7.6 million increase in provision for credit losses. Provision for credit losses in 2025 included $3.8 million related to the day 1 adjustment on non-PCD loans acquired in the Center acquisition.
Net interest income change (12 months) for basis point movements of: -200 -100 +100 +200 (dollars in thousands) December 31, 2024 ($) $ (28,123) $ (13,449) $ 13,690 $ 25,374 December 31, 2024 (%) (6.98) % (3.34) % 3.40 % 6.30 % December 31, 2023 ($) $ (38,890) $ (17,930) $ 18,545 $ 34,788 December 31, 2023 (%) (9.97) % (4.60) % 4.76 % 8.92 % 52 Table of Contents The Company evaluates its potential interest rate sensitivity by utilizing several interest rate scenarios that incorporate both rising and declining rates.
Net interest income change (12 months) for basis point movements of: -200 -100 +100 +200 (dollars in thousands) December 31, 2025 ($) $ (9,798) $ (4,118) $ 13,061 $ 25,334 December 31, 2025 (%) (2.25) % (0.95) % 3.00 % 5.82 % December 31, 2024 ($) $ (28,123) $ (13,449) $ 13,690 $ 25,374 December 31, 2024 (%) (6.98) % (3.34) % 3.40 % 6.30 % The Company evaluates its potential interest rate sensitivity by utilizing several interest rate scenarios that incorporate both rising and declining rates.
Offsetting these gains are $5.4 million in losses recognized on the sale of $75.1 million in available for sale securities, which were sold in order to reinvest into higher yielding investments. 40 Table of Contents Noninterest Expense The components of noninterest expense for each year in the three-year period ended December 31 are as follows: 2024 compared to 2023 2024 2023 2022 $ Change % Change (dollars in thousands) Noninterest Expense: Salaries and employee benefits $ 149,287 $ 142,871 $ 126,031 $ 6,416 4 % Net occupancy 19,783 19,221 18,037 562 3 Furniture and equipment 17,453 17,308 15,582 145 1 Data processing 15,582 15,010 13,922 572 4 Advertising and promotion 5,535 5,713 5,031 (178) (3) Pennsylvania shares tax 5,422 4,364 4,447 1,058 24 Intangible amortization 5,024 4,983 3,196 41 1 Other professional fees and services 5,533 5,919 4,894 (386) (7) FDIC insurance 5,973 6,260 2,871 (287) (5) Other operating expenses 35,350 34,389 30,748 961 3 Subtotal 264,942 256,038 224,759 8,904 3 Loss on sale or write-down of assets 451 204 343 247 121 Litigation and operational losses 4,592 4,641 2,834 (49) (1) Loss on early redemption of subordinated debt 369 — — 369 — Merger and acquisition related 391 9,034 1,702 (8,643) (96) Total noninterest expense $ 270,745 $ 269,917 $ 229,638 $ 828 0 % Total noninterest expense increased $0.8 million compared to the year ended December 31, 2023.
Offsetting these gains are $4.3 million and $5.4 million in losses recognized on the sale available for sale securities for 2025 and 2024, respectively, which were sold in order to reinvest into higher yielding investments. 41 Table of Contents Noninterest Expense The components of noninterest expense for each year in the three-year period ended December 31 are as follows: 2025 compared to 2024 2025 2024 2023 $ Change % Change (dollars in thousands) Noninterest Expense: Salaries and employee benefits $ 163,981 $ 149,287 $ 142,871 $ 14,694 10 % Net occupancy 20,714 19,783 19,221 931 5 Furniture and equipment 18,161 17,453 17,308 708 4 Data processing 16,359 15,582 15,010 777 5 Advertising and promotion 6,447 5,535 5,713 912 16 Pennsylvania shares tax 4,495 5,422 4,364 (927) (17) Intangible amortization 5,503 5,024 4,983 479 10 Other professional fees and services 6,892 5,533 5,919 1,359 25 FDIC insurance 6,117 5,973 6,260 144 2 Other operating expenses 38,201 35,350 34,389 2,851 8 Subtotal 286,870 264,942 256,038 21,928 8 Loss on sale or write-down of assets 654 451 204 203 45 Litigation and operational losses 2,925 4,592 4,641 (1,667) (36) Loss on early redemption of subordinated debt — 369 — (369) — Merger and acquisition related 4,379 391 9,034 3,988 1,020 Total noninterest expense $ 294,828 $ 270,745 $ 269,917 $ 24,083 9 % Total noninterest expense increased $24.1 million compared to the year ended December 31, 2024.

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